Mort Zuba, an automobile company, needs to pay off its loans to banks the following year. The company plans to sell its factories in Astonsia in order to pay its debts. In this scenario, Mort Zuba's ability to sell its factories in Astonsia to pay its debts is measured by calculating _____.
A) leverage ratios
B) asset management ratios
C) liquidity ratios
D) profitability ratios

Question

Quizplus · Accepted Answer

Liquidity ratios measure a company's ability to pay off its short-term liabilities with its short-term assets, such as selling factories to pay debts.

Mort Zuba, an Automobile Company, Needs to Pay Off Its