Which one of the following ratios would NOT likely be used by a short-term creditor in evaluating whether to sell on credit to a company?
A) acid-test ratio
B) days sales in inventory
C) asset turnover
D) receivables turnover

Question

Quizplus · Accepted Answer

Asset turnover is more concerned with how efficiently a company uses its assets to generate sales over a longer period, which might not be as relevant for a short-term creditor focused on the company's immediate liquidity or ability to pay short-term obligations.

Which One of the Following Ratios Would NOT Likely Be