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Please Refer to the Following Data: Using the "Rule

Question 154

Multiple Choice

Please refer to the following data: Please refer to the following data:   Using the  rule of thumb  guidelines, what conclusion could you draw? A) This business faces a liquidity problem, and may have trouble paying off its current liabilities with its current assets. B) This business has does not have enough total assets to meet its total obligations. C) This business has a very good current ratio, but the debt ratio indicates long-term liquidity problems. D) This business should have no difficulties paying off its liabilities. Using the "rule of thumb" guidelines, what conclusion could you draw?


A) This business faces a liquidity problem, and may have trouble paying off its current liabilities with its current assets.
B) This business has does not have enough total assets to meet its total obligations.
C) This business has a very good current ratio, but the debt ratio indicates long-term liquidity problems.
D) This business should have no difficulties paying off its liabilities.

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