Which one of the following is not a liquidity activity ratio?
A) inventory turnover ratio
B) time interest earned ratio
C) days to collect receivables ratio
D) days to sell inventory ratio

Question

Quizplus · Accepted Answer

The time interest earned ratio is a solvency ratio that measures a company's ability to meet its interest payments on outstanding debt. In contrast, inventory turnover ratio, days to collect receivables ratio, and days to sell inventory ratio are all liquidity activity ratios that analyze a company's ability to convert its assets into cash to pay off short-term obligations.

Which One of the Following Is Not a Liquidity Activity