Description : ---------------- ratio studies the firm’s ability to meet its long term financial position a) Liquidity ratio b) Profitability c) Activity d) Leverage
Last Answer : d) Leverage
Description : Stock turn over ratio is an example of ------------------- a) Liquidity ratio b) Leverage ratio c) Profitability ratios d) Activity ratios
Last Answer : d) Activity ratios
Description : The ratio that highlight the end result of business activities are known as ---------------- ratios a) Liquidity b) Leverage c) Activity d) Profitability
Last Answer : d) Profitability
Description : Current ratio is an example of -------------------- a) Leverage ratio b) Liquidity ratio c) Activity ratio d) Turnover ratio
Last Answer : b) Liquidity ratio
Description : Debtors turnover ratio is used to calculate------ a) efficiency b) solvency c) liquidity d) profitability
Last Answer : a) efficiency
Description : The ratios that shows tha capacity of the business unit to meet its short term obligation out of its short term resources is known as -------------- a) Solvency ratio b) Leverage ratio c) Liquidity ratio d) Trend Ratio
Last Answer : c) Liquidity ratio
Description : Leverage ratios are also known as -------------- ratios a) Short term solvency ratios b) Long term solvency ratios c) Solvency ratio d) Liquidity ratio
Last Answer : b) Long term solvency ratios
Description : Coverage of fixed assets by shareholder’s equity is a good tests of---------------- a) solvency b) liquidity c) Activity d) profitability
Last Answer : a) solvency
Description : By computing current ratio ---------------- solvency of a concern is assessed a) Short term b) Long term c) Liquidity d) Profitability
Last Answer : a) Short term
Description : The relationship between current assets and current liabilities is important in evaluating a company's a. profitability. b. liquidity. c. market value. d. accounting cycle.
Last Answer : b. liquidity.
Description : Stock turnover ratio is used to determine -----------------------of an enterprise a) Profitability b) Liquidity& solvency c) Efficiency d) Growth
Last Answer : c) Efficiency
Description : The index of efficiency and profitability of the business a) Operating ratio b) Operating profit ratio c) Expense ratio d) Net profit ratio
Last Answer : b) Operating profit ratio
Description : Solvency ratio indicates----------------- a) Credit worthiness b) Activity c) Profitability d) None of these
Last Answer : a) Credit worthiness
Description : he ratio which is used to ascertain the soundness of the long term financial position is------------ a) Debt equity ratio b) Liquidity ratio c) Activity ratio d) Gross profit ratio
Last Answer : a) Debt equity ratio
Description : Income statement ratios are also called ----------- a) Operating ratio b) Liquidity ratio c) Activity ratio d) Trend ratio
Last Answer : a) Operating ratio
Description : Rol measures----- a) Profitability in relation to investment b) Profitability in relation to sales c) Operating efficiency d) Long term solvency
Last Answer : a) Profitability in relation to investment
Description : Example of leverage ratio a) Debtors velocity b) Stock turnover ratio c) Current ratio d) Solvency ratio
Last Answer : d) Solvency ratio
Description : Debt equity ratio is a-------------------------------------- a) Profitability ratio b) Turnover ratio c) Short term solvency ratio d) Long term solvency ratio
Last Answer : d) Long term solvency ratio
Description : Dividend yield is an example for------ratio a) Solvency b) Liquidity c) Market strength d) Net worth
Last Answer : c) Market strength
Description : Current ratio shows----- a) The change in gross profit b) The working capital position c) The liquidity of assets d) The change in net profit
Last Answer : b) The working capital position
Description : Debt equity ratio is an example of ---------------- ratios a) Balance sheet ratio b) Profit & loss account ratio c) Mixed ratio d) Liquidity ratio
Last Answer : a) Balance sheet ratio
Description : Identify the incorrect statement in connection with working capital management. A. Long-term funds are more expensive than short-term funds but also riskier B. The objectives of ... fluctuating current assets E. Aggressive financing policies increase profitability at the cost of higher risk
Last Answer : A. Long-term funds are more expensive than short-term funds but also riskier
Description : In deciding the optimal level of current assets for the firm, management is confronted with . A. a trade-off between profitability and risk B. a trade-off between liquidity and risk C. a trade-off between equity and debt D. a trade-off between short-term versus long-term borrowing
Last Answer : A. a trade-off between profitability and risk
Description : Which of the following is a basic principle of finance as it relates to the management of working capital? A. Profitability varies inversely with risk. B. Liquidity moves together with risk. C. Profitability moves together with risk. D. Profitability moves together with liquidity.
Last Answer : C. Profitability moves together with risk.
Description : The ratio which is a good indicator to maintain the correct selling price and efficiency of trading activity is------ a) Net profit ratio b) Gross profit ratio c) Current ratio d) Liquid ratios
Last Answer : b) Gross profit ratio
Description : Ratios may be used as a measure of ------------- a) Effiency b) Solvency c) Profitability d) None of the above
Last Answer : a) Effiency
Description : Afford full diagnosis of the profitability and financial position a) Preparation of Profit and Loss Account b) Balance Sheet c) Final Accounts d) Analysis of financial statement
Last Answer : d) Analysis of financial statement
Description : ------------- gives a diagnosis of the profitability and financial position a) Analysis of financial statements b) Preparation of financial statements c) Construction of statements d) None of the above
Last Answer : a) Analysis of financial statements
Description : In terms of liquidity, merchandise inventory is a. more liquid than cash. b. more liquid than accounts receivable. c. more liquid than prepaid expenses. d. less liquid than store equipment.
Last Answer : c. more liquid than prepaid expenses.
Description : On a classified balance sheet, current assets are customarily listed a. in alphabetical order. b. with the largest dollar amounts first. c. in the order of liquidity. d. in the order of acquisition.
Last Answer : c. in the order of liquidity.
Description : Liquidity ratios measure the --------- solvency of a firm a) Long term b) Short term c) Average d) Others
Last Answer : b) Short term
Description : Is accrual accounting more closely related to a company’s goal of profitability or liquidity?
Last Answer : Profitability
Description : If a company moves from a "conservative" working capital policy to an "aggress ive" policy, it should expect . A. liquidity to decrease, whereas expected profitability would increase B. ... decrease C. liquidity would increase, whereas risk would also increase D. risk and profitability to
Last Answer : A. liquidity to decrease, whereas expected profitability would increase
Description : The payback method for the measurement of return on investment (A) Gives a correct picture of profitability (B) Underemphasises liquidity (C) Does not measure the discounted rate of return (D) Takes into account the cash inflows after the recovery of investments
Last Answer : (C) Does not measure the discounted rate of return
Description : Suppliers and creditors of a firm are interested in A. Profitability position B. Liquidity position C. Market share position D. Debt position
Last Answer : B. Liquidity position
Description : The relationship between two amount or variables is measured with the help of ------------ a) Ratio b) Trend c) Comparative d) Common size
Last Answer : a) Ratio
Description : Long term solvency of a firm can be measured by a) Current ratio b) Net profit ratio c) Gross profit ratio d) Debt equity ratio
Last Answer : d) Debt equity ratio
Description : Debtors turnover ratio measures---------- a) Short term solvency b) Operating efficiency c) Long term solvency d) Credit policy
Last Answer : a) Short term solvency
Description : Example of activity ratios ------------------------ a) Gross profit ratio b) Net profit ratio c) Operating ratio d) Stock turn over ratio
Last Answer : d) Stock turn over ratio
Description : The ratio that includes whether investment in inventory is efficiently used or not a) Inventory turnover ratio b) Working capital turn over ratio c) Fixed asset turn over ratio d) Activity ratio
Last Answer : a) Inventory turnover ratio
Description : The main aim of the ratio analysis is to help the ----------of the firm a) Owners b) Officials c) Departments d) Management
Last Answer : d) Management
Description : Which of the following would explain an adverse variable production overhead efficiency variance? 1. Employees were of a lower skill level than specified in the standard 2. Unexpected idle time resulted from a series of machine breakdown 3. ... b) (1) and (2) (c) (2) and (3) (d) (1) and (3)
Last Answer : (d) (1) and (3)
Description : During a period 17, 500 labour hours were worked at a standard cost of Rs 6.50 per hour. The labour efficiency variance was Rs 7,800 favourable. How many standard hours were produced? (a) 1,200 (b) 16,300 (c) 17,500 (d) 18,700
Last Answer : (d) 18,700
Description : A measure A measure of the success of an success of an operation in converting operation in converting inputs to inputs to outputs is outputs is a. Efficiency b. Effectiveness Effectiveness c. Quality d. Profitability
Last Answer : a. Efficiency
Description : A measure A measure of the success of an success of an operation in producing operation in producing outputs that outputs that satisfy customers satisfy customers is a. Efficiency b. Effectiveness Effectiveness c. Quality d. Profitability
Last Answer : c. Quality
Description : Closing entries a. are prepared before the financial statements. b. reduce the number of permanent accounts. c. cause the revenue and expense accounts to have zero balances. d. summarize the activity in every account.
Last Answer : c. cause the revenue and expense accounts to have zero balances.
Description : A budget which is prepared in a manner so as to give the budgeted cost for any level of activity is known as: (a) Master budget (b) Zero base budget ((c) Functional budget (d) Flexible budget
Last Answer : (d) Flexible budget
Description : Q.61. CA Co manufactures a single product and has drawn up the following flexed budget for the year. 60% 70% 80% Rs Rs Rs Direct materials 120,000 140,000 160,000 Direct labour 90,000 105,000 120,000 Production ... activity? (a) Rs 330,300 (b) Rs 370,300 (c) Rs 373,300 (d) Rs 377,300
Last Answer : (b) Rs 370,300
Description : A segment of activity or area of operation for which revenues are accumulated is known as ------ a) Cost centre b) Profit centre c) Revenue centre d) Investment centre
Last Answer : c) Revenue centre
Description : A segment of activity or area of operation for which cost is collected is known as ----------------- a) Cost centre b) Profit centre c) Investment centre d) Responsibility centre
Last Answer : a) Cost centre