Which of the following statements is true of current ratio?
A. The larger a firm's current ratio, the harder it is for the firm to pay its short-term debts.
B. The current ratio is a type of leverage ratio.
C. A current ratio that is below 1.0 signifies a company's inability to pay its short-term liabilities with its current assets.
D. The current ratio is computed by dividing a firm's current liabilities by its current assets.
Answer: C
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Describe family enterprise and apply the concept to your business concept.
What will be an ideal response?
Which of the following best describes the term "title"?
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Blair Madison Co. issues $1.5 million of new stock and pays $241,000 in cash dividends during the year. In addition, the company took advantage of falling interest rates to borrow $1.55 million in a new bond issue and paid off existing bonds with a face value of $2.25 million. The company bought 505 of another company's $1050 bonds at a $105,000 premium. The net cash flow provided by financing activities is:
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