MC03 3/4 will upvote

Which of the following statements is correct? With liquidity ratios, it is assumed that the fixed assets will be converted to cash which will then be used to retire total liabilities. LTD to Totat Capitalization = Long Term Debt / (Short Term Debt + Total Assets). All the answers are correct. Inventory Turnover = Gross Profit / Inventory. The total asset turnover ratio describes how efficiently the firm is using all of its assets to generate sales. Which of the following statements is correct? All the answers are correct. Total Debt Ratio = Total Assets / Total Liabilities. The current ratio will always be less than the quick ratio, unless the firm has no invehtory. Coverage ratios describe the quantity of funds available to "cover" certain expenses, particularly interest expense though this is not the only one. LTD to Equity = Long Term Debt / Total Assets