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Short-term ability to pay/Ratio Analysis

Ratio analysis for the short-term is important and many of the techniques are easy to use and can provide you significant data as to the company's ability to pay short-term debt. But, will these same techniques provide you with abundant information about the current daily operations for the same period? Will the cash flow of the operations be sufficient to pay the employees each week? Explain.

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The ratio analysis for the short-term debt includes current ratio and quick or acid test ratio. The current ratio is calculated by dividing the total current assets by total current liabilities. The quick ...

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This solution is comprised of a detailed explanation to answer will these same techniques provide you with abundant information about the current daily operations for the same period and will the cash flow of the operations be sufficient to pay the employees each week.

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