Which of the following ratios is not an indicator of a company's short-term financial strength?
A)Earnings quality.
B)Current ratio.
C)Cash ratio.
D)Quick ratio.

Question

Quizplus · Accepted Answer

Earnings quality is not directly related to a company's short-term financial strength, as it usually reflects the reliability of a company's reported earnings over a longer period, rather than its short-term liquidity or ability to pay its immediate obligations. The other three ratios are commonly used to measure a company's short-term financial strength. The current ratio, quick ratio, and cash ratio all provide insights into a company's ability to meet its short-term debt obligations and manage its cash flow.

Which of the Following Ratios Is Not an Indicator of a Company's