A common measure of liquidity is
A) profit margin.
B) receivable turnover.
C) return on assets.
D) asset turnover.

Question

Quizplus · Accepted Answer

Receivable turnover is a common measure of liquidity as it shows how quickly a company is able to collect payments from its customers. This gives an indication of the company's ability to maintain cash flow and meet short-term obligations. Profit margin, return on assets, and asset turnover are not direct measures of liquidity.

A Common Measure of Liquidity Is