Question Details

The current ratio is a measure of the ability of a company to pay its short-term liabilities 



True or false:

1.	The current ratio is a measure of the ability of a company to pay its short-term liabilities out of short-term assets.

	
	2.	The inventory turnover ratio measures the number of days the average balance of accounts receivable is outstanding before being converted into cash.


	3.	Inventory turnover is a measure of liquidity that focuses on efficient use of inventory.

	

	4.	The quick ratio should be larger than the current ratio.


5.	All debt is considered in the computation of the quick ratio.





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