Chapter 8 Flashcards
1
Q
Liquidity
A
Measure of how quickly an asset can be converted into cash or a liability can be paid
2
Q
Current ratio
A
Current assets divided by current liabilities
3
Q
Quick ratio
A
Quick assets divided by current liabilities
4
Q
Quick assets
A
Consists of cash, short-term securities, accounts receivable and short-term notes
5
Q
Financial flexibility
A
A business’ ability to adapt to change
