Answer / suman sharma

Generally speaking, you must limit expenses and ensure that
some of your assets are in the form of short term assets.
The higher your short term assets and the less your short
term debt, the better your ability to pay the debt (short
term liquidity ratio / liquidity ratio help you determine
this).

There is no perfect number or ratio for every firm. Each
industry/business is unique. Strive to control debt (some
debt is very good since it helps a business grow) and to
maintain enough assets in the form of cash and cash
equivalents.

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