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easyMCQCUET Accountancy 16 July Shift 22026CUET Accountancy
1 mark

Make the right combination of ratios that enables to find the short-term liquidity of a firm:A. Return on EquityB. Acid Test RatioC. Sacrificing RatioD. Inventory Turnover RatioE. Current RatioChoose the correct answer from the options given below:

  1. A
    B and E only
  2. B
    A and C only
  3. C
    A and E only
  4. D
    C and D only

Solution & Step-by-step Explanation

Short-term liquidity ratios assess an enterprise's ability to meet its current financial obligations. The key indicators of short-term liquidity are:Current Ratio (E)Acid Test Ratio / Quick Ratio (B)Return on Equity (A) is a profitability ratio.Sacrificing Ratio (C) belongs to partnership accounting.Inventory Turnover Ratio (D) is an efficiency/activity ratio.

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Make the right combination of ratios that enables to find the short-term liquidity of a firm:A. Return on EquityB. Acid Test RatioC. Sacrificing RatioD. Inventory Turnover RatioE. Current RatioChoose the correct answer from the options given below:
A
B and E only
B
A and C only
C
A and E only
D
C and D only

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