Which of the following is a major concern of a company\'s short term creditors?

Question

Which of the following is a major concern of a company's short term creditors? The size of the cash dividends The ability of the company to pay ofTits bonds The ability to pay its obligations when due Its pricc earnings ratio Which of the following is the purpose of horizontal analysis? To see how profitable a company is To test a company's liquidity To determine increases or decreases that have taken place over some time periods To test a company's solvency A company had the following sales data: 2010, $960,000; 2009, $880,000,2008, $800,000. Using 2008 as the base year, what is the percentage increase in sales from 2008 to 2010? 20% 120% 16.33% 2% Using vertical analysis, what is the base used for gross profit? Net sales Net income Total assets Gross sales The base for common stock using vertical analysts is which of the following? Retained earnings Total stockholders' equity Total liabilities and stockholders equity Current assets Ratios that measure the ability of a company to meet currently maturing obligations and unexpected needs for cash are called which of the following? Liquidity ratios Trend ratios Solvency ratios Profitability ratios

Explanation / Answer

1. The ability to pay its obligation when due

2. To determine increases or decreases that have taken place over some period of time

3. 20%

4. Gross sales

5. Total stockholders' equity

6. Liquidity ratios

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