U2 Ltd Is Considering Whether to Offer Trade Credit to A1

Multiple Choice

U2 Ltd is considering whether to offer trade credit to A1 Ltd. The ratio from A1's accounts that will be most useful in assessing the firm's ability to repay its trade debts on time is the:

A) gearing.
B) average settlement period for trade payables.
C) interest cover.
D) asset turnover period.