Calculate the ________ to assess liquidity (an indicator of a company's ability to cover its current liabilities).
A)debt ratio
B)current ratio
C)times interest earned ratio
D)asset ratio

Question

Quizplus · Accepted Answer

The current ratio is the best choice to assess liquidity as it measures a company's ability to cover its current liabilities with its current assets. A higher current ratio indicates a company has more short-term assets to cover its short-term debts.

Calculate the ________ to Assess Liquidity (An Indicator of a Company's