Which of the following would be the most useful in determining if a company has sufficient resources to continue operations in the short-term?
A)the profit margin ratio
B)the return on assets ratio
C)the cash from operating activities
D)the cash from financing activities

Question

Quizplus · Accepted Answer

The cash from operating activities on the cash flow statement shows the amount of cash generated from the company's core operations, which is a good indication of whether the company has enough resources to continue operations in the short-term. The profit margin ratio and return on assets ratio are more focused on profitability and efficiency, which may not directly reflect the availability of resources. The cash from financing activities is more reflective of how a company is funding its operations, rather than the availability of resources for short-term operations.

Which of the Following Would Be the Most Useful in Determining