_____ provide information about liquidity-a firm's ability to meet short-term obligations as they come due.

Question

Quizplus · Accepted Answer

Both working capital and current ratio provide information about a firm's liquidity. Working capital measures the difference between current assets and current liabilities, while the current ratio measures the ability of a firm to pay off its current liabilities with its current assets. Together, these ratios give a comprehensive picture of a firm's liquidity. The other options provided (positive leverage ratio and cash flows ratio) do not specifically provide information about a firm's ability to meet short-term obligations.

_____ Provide Information About Liquidity-A Firm's Ability to Meet Short-Term