The best measure of a company's ability to meet imminent financial obligations is known as the
A) current ratio.
B) total asset turnover.
C) debt ratio.
D) profit margin.

Question

Quizplus · Accepted Answer

The current ratio, calculated as current assets divided by current liabilities, is the best measure of a company's ability to meet short-term financial obligations. It provides a snapshot of the firm's liquidity and financial health in the near term.

The Best Measure of a Company's Ability to Meet Imminent