A-LevelAccountingAnalysis and communication of accounting information9706/12 · Feb/Mar 2021 · Q191 Mark

Which ratio will help a business assess its ability to meet its immediate cash requirements?

Aexpenses to revenue

Bliquid (acid test)

Cnon-current asset turnover

Dreturn on capital employed

✓ Correct answer

B: liquid (acid test)

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Topic: Analysis and communication of accounting information, A-Level Accounting (syllabus 9706). Multiple choice, 1 mark.
Source: A-Level Accounting, Feb/Mar 2021 Paper 1 Variant 2, question 19.

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