Response to the following questions:
1. Which ratio best reflects a company's ability to meet immediate interest payments? (a) Debt ratio. (b) Equity ratio. (c) Times interest earned.
2. 1. Which two short-term liquidity ratios measure how frequently a company collects its accounts?
2. What measure reflects the difference between current assets and current liabilities?
3. Which two ratios are key components in measuring a company's operating efficiency? Which ratio summarizes these two components?