Other than net income and sales, liquidity ratios use ___ items.

Question

Quizplus · Accepted Answer

Liquidity ratios use balance sheet items such as current assets and current liabilities to measure a company's ability to meet its short-term obligations. While cash flow and inventory are important factors for a company's liquidity, they are not used in liquidity ratios. Tax returns are also not used in liquidity ratios as they do not provide information on a company's current assets or current liabilities.

Other Than Net Income and Sales, Liquidity Ratios Use ___