The answer is B) The current ratio
Rest A) and C) are both solvency ratio that measures an enterprise’s ability to meet its debt obligations.
12) Which of the following is not a solvency ratio? A) Time interest earned ratio. B)...
Which of the following ratios are correctly described as liquidity and solvency ratios? Liquidity Solvency A. Cash Current B. Current Debt to equity C. Debt to equity Financial leverage Group of answer choices Row C Row B Row A
Which of the following would be considered liquidity or short-term solvency ratios? quick ratio; cash ratio. quick ratio; times interest earned ratio (TIE). current ratio; long-term debt ratio. current ratio; inventory turnover ratio;
please help
1. A times interest earned ratio of 1.20 to 1 means: a. that the firm will default on its interest payment. b. that net income is less than the interest expense c. that the cash flow is less than the net income. d. that the cash flow exceeds the net income e. that net income is greater than the interest expense. 2. The debt ratio indicates: a. the ability of the firm to pay its current obligations. b....
Compute and Interpret Liquidity, Solvency and Coverage Ratios Selected balance sheet and income statement information for Calpine Corporation for 2004 and 2006 follows. ($ millions) 2004 2006 Cash $ 1,256.73 $ 1,523.36 Accounts receivable 1,097.16 735.30 Current assets 3,313.56 3,268.33 Current liabilities 3,285.39 6,057.95 Long-term debt 17,150.81 3,531.63 Short-term debt 1,033.96 4,568.83 Total liabilities 22,898.42 25,503.17 Interest expense 1,516.90 1,288.29 Capital expenditures 1,545.48 211.50 Equity 4,587.67 (7,152.90) Cash from operations 19.89 335.98 Earnings before interest and taxes 1,659.84 1,907.84 (a)...
Which of the following statement is correct? A. The higher the debt to total assets ratio of a company, the lower the risk that the company may be unable to meet its maturing obligations and the better of the company’s solvency ability. B. The higher the times interest earned ratio, the worse of the company’s solvency ability. C. A bond’s stated rate is 8% and the effective market rate is 6%. Theoretically, the bond should be issued at premium. D....
Which of the following is not a liquidity ratio? Select one: O a. Current ratio b. Quick ratio c. Debt-to-equity ratio d. Interest coverage ratio
Question 9 Homework Answered Which of the following is true of a solvency ratio? Select an answer and submit. For keyboard navigation, use the up/down arrow keys to select an answer. a It is a measure of the speed that groups of assets move through the company. b It helps the analyst estimate the likelihood that the company will have sufficient cash to pay its bills as they come due. с It helps the analyst determine the riskiness of te...
Question 9 Homework. Answered Which of the following is true of a solvency ratio? Select an answer and submit. For keyboard navigation, use the up/down arrow keys to select an answer. a It is a measure of the speed that groups of assets move through the company. b It helps the analyst estimate the likelihood that the company will have sufficient cash to pay its bills as they come due. с It helps the analyst determine the riskiness of te...
Compute and Interpret Liquidity, Solvency and Coverage Ratios Balance sheets and income statements for Lockheed Martin Corporation follow. Refer to these financial statements to answer the requirements. Income Statement Year Ended December 31 (In millions) 2005 2004 2003 Net sales Products $ 31,518 $ 30,202 $ 27,290 Service 5,695 5,324 4,534 37,213 35,526 31,824 Cost of sales Products 28,800 27,879 25,306 Service 5,073 4,765 4,099 Unallocated coporate costs 803 914 443 34,676 33,558 29,848 2,537 1,968 1,976 Other income (expenses),...
Compute and Interpret Liquidity, Solvency and Coverage Ratios Balance sheets and income statements for Lockheed Martin Corporation follow. Refer to these financial statements to answer the requirements. Consolidated Statements of Earnings Year Ended December 31 (In millions) 2016 2015 Net sales Products $ 40,365 $ 34,868 Services 6,883 5,668 Total net sales 47,248 40,536 Cost of sales Products (36,616) (31,091) Services (6,040) (4,824) Severance and other charges (80) (82) Other unallocated costs 550 (47) Total cost of sales (42,186) (36,044)...