Asked by
Erika Castro
on Oct 09, 2024
Verified
Purchasing marketable securities with cash will have no effect on a company's acid-test ratio.
Acid-Test Ratio
A financial metric that measures the immediate liquidity position of a company by comparing its most liquid assets (excluding inventory) against its current liabilities.
Marketable Securities
Financial instruments and assets that can be easily sold or converted into cash without a significant loss of value.
- Understand the principles of liquidity and how transactions affect it.
Verified Answer
EB
Learning Objectives
- Understand the principles of liquidity and how transactions affect it.