An creditor might look at a company's financial statements to determine if the company's:

Question

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An creditor would typically be interested in a company's ability to pay back its debts. One way to assess this is by looking at the company's financial statements to determine if it has enough assets to cover its liabilities. This is usually done by calculating the company's current ratio, which is the ratio of current assets to current liabilities. If the current ratio is above 1, it suggests that the company has enough short-term assets to cover its short-term debts.

An Creditor Might Look at a Company's Financial Statements to Determine