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Match the term and the definition Terms 1. May provide some assurance that the company can pay its creditors in full and on time Acid-test
Match the term and the definition | Terms | |||
1. | May provide some assurance that the company can pay its creditors in full and on time | Acid-test ratio | ||
2. | Should be interpreted with care | Current ratio | ||
3. | Computed by dividing quick assets by current liabilities | Working Capitl | ||
1. | Measures how quickly credit sales are converted to cash | Accounts receivable turnover ratio | ||
2. | Computed as 365 days divided by the accounts receivable turnover ratio | Operating cycle | ||
3. | Measures the elapsed time from when inventory is received from suppliers to when cash is received from customers | Average collection period |
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