A primary benefit of reclassification of short-term debt into long-term debt is to improve ________.
A) solvency ratios
B) liquidity ratios
C) cash flow
D) profitability

Question

Quizplus · Accepted Answer

Reclassifying short-term debt as long-term debt improves liquidity ratios by reducing current liabilities, which increases the current ratio and other liquidity measures.

A Primary Benefit of Reclassification of Short-Term Debt into Long-Term