Vendors providing trade credit to a ﬁrm tend to be most interested in the ﬁrm's __________ ratios.
A) liquidity
B) proﬁtability
C) market value
D) asset management
E) ﬁnancial leverage

Question

Quizplus · Accepted Answer

Vendors are most concerned with getting paid promptly for their goods or services. Therefore, they tend to focus on the firm's ability to generate cash and pay bills in a timely manner, which is indicated by its liquidity ratios such as current ratio and quick ratio.

Vendors Providing Trade Credit to a ﬁRm Tend to Be