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Question 9 Homework. Answered Which of the following is true of a solvency ratio? Select an answer and submit. For keyboard n

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Answer #1

Correct answer : b. it helps the analyst estimate the likelihood that the company will have sufficient cash to pay its bills as they come due.

Reason : Solvency Ratio = (Net Income + Depreciation) / All liabilities

This ratio helps in analysing whether there is sufficient Cash available with the firm/company to any liability.

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