By computing current ratio ---------------- solvency of a concern is assessed a) Short term b) Long term c) Liquidity d) Profitability

By computing current ratio ---------------- solvency of a concern is assessed a) Short term
b) Long term
c) Liquidity
d) Profitability
by

1 Answer

Answer :

a) Short term
by

Related questions

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Description : Debtors turnover ratio is used to calculate------ a) efficiency b) solvency c) liquidity d) profitability

Last Answer : a) efficiency

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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

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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

Coverage of fixed assets by shareholder’s equity is a good tests of---------------- a) solvency b) liquidity c) Activity d) profitability

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Last Answer : a) solvency

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

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

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Last Answer : b) Short term

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Stock turnover ratio is used to determine -----------------------of an enterprise a) Profitability b) Liquidity& solvency c) Efficiency d) Growth

Description : Stock turnover ratio is used to determine -----------------------of an enterprise a) Profitability b) Liquidity& solvency c) Efficiency d) Growth

Last Answer : c) Efficiency

Solvency ratio indicates----------------- a) Credit worthiness b) Activity c) Profitability d) None of these

Description : Solvency ratio indicates----------------- a) Credit worthiness b) Activity c) Profitability d) None of these

Last Answer : a) Credit worthiness

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Stock turn over ratio is an example of ------------------- a) Liquidity ratio b) Leverage ratio c) Profitability ratios d) Activity ratios

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Last Answer : d) Profitability

Debtors turnover ratio measures---------- a) Short term solvency b) Operating efficiency c) Long term solvency d) Credit policy

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

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.

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.

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Ratio to assess the short term debt paying capacity of a firm is---------- a) Debt equity ratio b) Propriety ratio c) Liquid ratio d) Solvency ratios

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Last Answer : c) Liquid ratio

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

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

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 working capital management are profitability and liquidity C. Permanent current assets should be financed from long-term sources if a moderate or matching policy is adopted D. Conservative financing policies use short-term funds to finance only part of fluctuating current assets E. Aggressive financing policies increase profitability at the cost of higher risk

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Last Answer : A. Long-term funds are more expensive than short-term funds but also riskier

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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

Capital gearing ratio is ___________. (a) Market test ratio (b) Long-term solvency ratio (c) Liquid ratio (d) urnover ratio

Description : Capital gearing ratio is ___________. (a) Market test ratio (b) Long-term solvency ratio (c) Liquid ratio (d) urnover ratio

Last Answer : (b) Long-term solvency ratio

Example of leverage ratio a) Debtors velocity b) Stock turnover ratio c) Current ratio d) Solvency ratio

Description : Example of leverage ratio a) Debtors velocity b) Stock turnover ratio c) Current ratio d) Solvency ratio

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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

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

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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

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Last Answer : b) The working capital position

Current ratio is an example of -------------------- a) Leverage ratio b) Liquidity ratio c) Activity ratio d) Turnover ratio

Description : Current ratio is an example of -------------------- a) Leverage ratio b) Liquidity ratio c) Activity ratio d) Turnover ratio

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Lower stock turnover ratio indicates------------------------------- a) Solvency position b) Monopoly situation c) Over investment in inventory d) None of these

Description : Lower stock turnover ratio indicates------------------------------- a) Solvency position b) Monopoly situation c) Over investment in inventory d) None of these

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Ratio of net profit before interest and tax to sales is------------------------------ a) Solvency ratio b) Capital gearing c) Operating profit ratio d) None of these

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The relationship between total outside liabilities and total assets can be indicated through ------------ a) Fixed asset ratio b) Solvency ratio c) Fixed asset turn over ratio d) Proprietary ratio

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------------- 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

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Last Answer : c. relationship between current assets and current liabilities.

An essential tool of short term financial analysis a) Fund flow statement b) Statement of uses and application of funds c) Cash flow statement d) Ratio analysis

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Is accrual accounting more closely related to a company’s goal of profitability or liquidity?

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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.

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Last Answer : An overly complex organizational structure involving unusual lines of authority.

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Description : If Happy Bags expresses concern that its products are having too great an impact on the pollution of ground water under landfills, this concern is directly related to the firm's: A)social responsibility. B)marketing orientation. C)profitability. D)ethics. E)distribution system.

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On a classified balance sheet, merchandise inventory is classified as a. an intangible asset. b. property, plant, and equipment. c. a current asset. d. a long-term investment.

Description : On a classified balance sheet, merchandise inventory is classified as a. an intangible asset. b. property, plant, and equipment. c. a current asset. d. a long-term investment.

Last Answer : c. a current asset.