All of the following are considered to be measures of a company's short-term debt-paying ability except:
A)Current ratio.
B)Inventory turnover.
C)Earnings per share.
D)Average collection perioD.Liquidity ratios indicate a firm's short-term ability to pay its current obligations. Liquidity ratios include: working capital, current ratio, acid test (quick) ratio, accounts receivable turnover, average days to collect ratio, inventory turnover and average days to sell inventory. Earnings per share is a stock market ratio.

Question

Quizplus · Accepted Answer

Earnings per share is not a measure of a company's short-term debt-paying ability, it is a measure of a company's profitability. The other options listed are liquidity ratios which indicate a company's ability to meet its short-term obligations.

All of the Following Are Considered to Be Measures of a Company's