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Coffee Beans (Australia) Ltd is your employer and they want to know whether they should extend trade credit to another company called Caffeine Club Ltd,
Coffee Beans (Australia) Ltd is your employer and they want to know whether they should extend trade credit to another company called Caffeine Club Ltd, Your manager knows you have studied accounting ratios and requests your help. Which of the following ratios would be most suitable to apply to the accounts of Caffeine Club Ltd to determine whether they will be able to repay their trade credit debts in a timely fashion? (a) Gearing ratio (b) Average settlement period for accounts receivable (c) Interest cover ratio (d) Average settlement period for accounts payable
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