Leon is the owner of a corner store.Which ratio should he compute if he wants to know how long the store can pay its bills given its current level of cash and accounts receivable? Assume all receivables are collectible when due.
A)Current ratio
B)Debt ratio
C)Cash coverage ratio
D)Cash ratio
E)Quick ratio

Question

Quizplus · Accepted Answer

The Quick ratio measures a company's ability to meet its short-term obligations with its most liquid assets, excluding inventory, which is suitable for assessing how long the store can pay its bills with cash and receivables.

Leon Is the Owner of a Corner Store