Question on: JAMB Accounting - 2015
What does liquidity ratio measure?
A
measures operating efficiency of a company
B
measures the ability of a company to meet its current obligations.
C
measures the value of investments of a company
D
measures the financial leverage of a company
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Correct Option: B
liquidity ratio attempt to measure the ability to meet up with current obligations e.g. current ratio which measures the current asset to current liabilities.
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