Question

Which of the following is true with respect to NET WORKING CAPITAL? A. If a firm’s...

Which of the following is true with respect to NET WORKING CAPITAL?

A. If a firm’s current ratio is 1, then its net working capital is 1.

B. If a firm’s current ratio is less than 1, it will have positive working capital.

C. If a firm’s current ratio is greater than 1, it will have negative working capital.

D. a, b, and c are all true

E. a, b and c are all not true (false)

Which ratio best describes how well a firm has its interest obligations covered?

a. the inventory turnover ratio

b. the interest to depreciation ratio

c. the total debt ratio

d. the times interest earned ratio

e. the debt to equity ratio

Business   Accounting   
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Answer #1

The answer has been presented in the supporting sheet. For detailed answer refer to the supporting sheet.

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