Which ratio does not focus on short-term solvency?
A) Quick ratio.
B) Cash ratio.
C) Net working capital to total assets.
D) Interval measure.
E) Cash coverage ratio.

Question

Quizplus · Accepted Answer

The cash coverage ratio focuses on a company's ability to cover its interest obligations with its operating cash flow, which is more related to long-term solvency and financial stability rather than short-term liquidity or solvency.

Which Ratio Does Not Focus on Short-Term Solvency