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Question 508 - CSCP discussion

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A company is evaluating a potential supplier for a strategic, long-term relationship. Which of the following metrics would be the best indicator to assess the supplier's fiscal health and ...t potential bankruptcy?

A.
quick ratio
Answers
A.
quick ratio
B.
aggregate inventory turnover
Answers
B.
aggregate inventory turnover
C.
Financial Z-Score
Answers
C.
Financial Z-Score
D.
Days of supply
Answers
D.
Days of supply
Suggested answer: C

Explanation:

According to the APICS CSCP - Supply Chain Management Certification2, the financial Z-Score is a metric that measures the probability of a company going bankrupt within two years, based on a combination of financial ratios such as liquidity, profitability, leverage, and activity. A higher Z-Score indicates a lower risk of bankruptcy, while a lower Z-Score indicates a higher risk of bankruptcy.

asked 16/09/2024
Hector Quintero
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