Question

Which one of the following ratios would not likely be used by a shon-term creditot in evaluating whether ta sel on aedit to a company? Muttiple Crioice Receivables tirneyer Dividend yieid Cutrent retio A supplier to a company would be mort interested in the Mutipie Chbice attet tumpver rites cument iutio free cesh fow

Answer 1

Step-by-step explanation:

A short-term creditor would likely not use the dividend yield ratio in evaluating whether to extend credit to a company. The dividend yield ratio is a measure of the return on investment for shareholders and is not directly related to the company's ability to pay back short-term debt.

On the other hand, a supplier to a company would likely be more interested in the accounts receivable turnover ratio, current ratio, and free cash flow, as these ratios provide insight into the company's liquidity and ability to pay its bills on time.