The ratio of the sum of cash and other current assets that can be easily converted to cash to current liabilities is called as:
A)price-earnings ratio.
B)earnings ratio.
C)quick ratio.
D)current ratio.

Question

Quizplus · Accepted Answer

The ratio of the sum of cash and other current assets that can be easily converted to cash to current liabilities is called the quick ratio. This ratio measures a company's ability to meet its short-term obligations with its most liquid assets. The quick ratio is also known as the acid-test ratio.

The Ratio of the Sum of Cash and Other Current