Which of the following ratios should you use if you want to assess whether a company's operating cash flows are sufficient to pay for PPE purchases?
A)Capital acquisitions ratio.
B)Debt-to-assets ratio.
C)Quality of income ratio.
D)Cash coverage ratio.

Question

Quizplus · Accepted Answer

The capital acquisitions ratio measures the ability of a company's operating cash flows to cover its capital expenditures, such as purchases of property, plant, and equipment (PPE).

Which of the Following Ratios Should You Use If You