A company must have less than 30 days' sales uncollected to be adequately liquid.

Question

Quizplus · Accepted Answer

Liquidity is determined by a company's ability to meet its short-term obligations, and while having less than 30 days' sales uncollected can indicate good liquidity, there is no strict rule that this must be the case for a company to be considered adequately liquid. Liquidity is more comprehensively assessed through various metrics such as the current ratio, quick ratio, and cash flow.

A Company Must Have Less Than 30 Days' Sales Uncollected