Each of the following is a liquidity ratio except the

a. acid-test ratio. b. current ratio. c. inventory turnover. d. debt to total assets ratio.

Correct answer is C – inventory turnover

Explanation:

Liquidity ratios are used in order to determine the company’s ability to pay off its current debt obligations using its available resources.

In turn, inventory turnover is a financial ratio showing how many times the firm has replaced its inventory during a specific period of time.

Economics

3 years ago

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