The ability to generate cash to pay bills is known as __________.
A) liquidity
B) leverage
C) asset management
D) profitability

Question

Quizplus · Accepted Answer

Liquidity refers to the ability of a company to generate cash and convert assets into cash to pay bills and meet short-term obligations. This is a crucial aspect of financial management as it ensures that the company can operate smoothly without facing cash flow issues. Leverage refers to the use of debt to finance operations or investments, while asset management refers to the management of a company's assets to maximize their value. Profitability refers to the ability of a company to generate profits and earnings over a period of time.

The Ability to Generate Cash to Pay Bills Is Known