Empirical research cited in the text indicates that firms

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Empirical research cited in the text indicates that firms with an operating cash flow to current liabilities ratio exceeding .40 portray low short term liquidity risk. Similarly, firms with an operating cash flow to total liabilities ratio exceeding 20 percent portray low long- term solvency risk. What do these empirical results suggest about the mix of current and noncurrent liabilities for a financially healthy firm? What do they suggest about the mix of liabilities versus shareholders equity financing.

Reference no: EM13590751

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