Which of the following is not a solvency ratio?
A)Time interest earned ratio.
B)The debt to equity ratio.
C)The current ratio.
D)All of the other options are solvency ratios.

Question

Quizplus · Accepted Answer

The current ratio is actually a liquidity ratio, which measures a company's ability to pay its current liabilities with its current assets. Solvency ratios, on the other hand, focus on a company's ability to meet its long-term debts and obligations. The Time interest earned ratio and the debt to equity ratio are both examples of solvency ratios.

Which of the Following Is Not a Solvency Ratio