Question

Linette Enterprises is a​ start-up company seeking financing. The loan officer is most concerned with whether the company has enough resources to pay its debts over the next 12 months. Which financial ratio should most likely be​ examined?

A. Current ratio
B. Total asset turnover
C. Inventory turnover
D. Return on investent
E. Debt to assets

Answer 1

A, Current Ratio

Step-by-step explanation:

Current ratio is the liquidity ratio that measures a company's ability to meet short-term financial obligations or financial obligations within a year.

This calculation of a company's current ration involves taking into account the current assets of the company and making investors and analysts understand how those assets can be maximized on the cmpany's balance sheets to help the company take care of its det and payables within the period.

Cheers.