CHAPTER 8 QUIZ 6 TO 10

CHAPTER 8  QUIZ 6 TO 10

6. The Beaver and Altman bankruptcy studies found that firms can survive at least two years once they declare bankruptcy

7. The Beaver and Altman bankruptcy studies indicated that ratios of failing firms signal failure as much as five years ahead of bankruptcy

8. According to Z score analysis, the higher the Z score the greater the firm's bankruptcy potential

9. Financial ratios are meaningless unless they are compared to a company standard, or historical or industry data.


10. The liquidity ratios measure how quickly a firm can dispose of inventory.

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