---------------- ratio studies the firm’s ability to meet its long term financial position a) Liquidity ratio b) Profitability c) Activity d) Leverage

---------------- ratio studies the firm’s ability to meet its long term financial position a) Liquidity ratio
b) Profitability
c) Activity
d) Leverage
by

1 Answer

Answer :

d) Leverage
by

Related questions

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

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

The efficiency of the management can be measured with the help of ------------------ a) Activity ratio b) Leverage ratio c) Liquidity ratio d) Profitability ratio

Description : The efficiency of the management can be measured with the help of ------------------ a) Activity ratio b) Leverage ratio c) Liquidity ratio d) Profitability ratio

Last Answer : a) Activity ratio

The ratio that highlight the end result of business activities are known as ---------------- ratios a) Liquidity b) Leverage c) Activity d) Profitability

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

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

Last Answer : c) Liquidity ratio

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

Last Answer : a) Debt equity ratio

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

Last Answer : b) Liquidity ratio

Leverage ratios are also known as -------------- ratios a) Short term solvency ratios b) Long term solvency ratios c) Solvency ratio d) 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

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

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

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

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

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

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

Last Answer : a) efficiency

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.

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

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

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

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

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

Income statement ratios are also called ----------- a) Operating ratio b) Liquidity ratio c) Activity ratio d) Trend 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

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

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

Debt equity ratio is a-------------------------------------- a) Profitability ratio b) Turnover ratio c) Short term solvency ratio d) Long term 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

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

Last Answer : d) Solvency ratio

Rol measures----- a) Profitability in relation to investment b) Profitability in relation to sales c) Operating efficiency d) Long term solvency

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

Suppliers and creditors of a firm are interested in A. Profitability position B. Liquidity position C. Market share position D. Debt position

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

Liquidity ratios measure the --------- solvency of a firm a) Long term b) Short term c) Average d) Others

Description : Liquidity ratios measure the --------- solvency of a firm a) Long term b) Short term c) Average d) Others

Last Answer : b) Short term

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

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

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

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

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

The index of efficiency and profitability of the business a) Operating ratio b) Operating profit ratio c) Expense ratio d) Net profit ratio

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

Dividend yield is an example for------ratio a) Solvency b) Liquidity c) Market strength d) Net worth

Description : Dividend yield is an example for------ratio a) Solvency b) Liquidity c) Market strength d) Net worth

Last Answer : c) Market strength

Debt equity ratio is an example of ---------------- ratios a) Balance sheet ratio b) Profit & loss account ratio c) Mixed ratio d) Liquidity ratio

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

In which circumstance is a CPA firm's independence most likely to be impaired? a. An individual on the audit has a close relative who is a receptionist for the client. b. The father of the audit senior holds a material financial interest in the client of which the senior is unaware. c. The spouse of a staff member on the audit has an immaterial common stock investment in the audit client. d. The partner in charge of the office's compensation is affected by office profitability, a portion of which arises from this audit

Description : In which circumstance is a CPA firm's independence most likely to be impaired? a. An individual on the audit has a close relative who is a receptionist for the client. b. The father of ... of the office's compensation is affected by office profitability, a portion of which arises from this audit

Last Answer : The spouse of a staff member on the audit has an immaterial common stock investment in the audit client

In which circumstance is a CPA firm's independence most likely to be impaired? a. An individual on the audit has a close relative who is a receptionist for the client. b. The father of the audit senior holds a material financial interest in the client of which the senior is unaware. c. The spouse of a staff member on the audit has an immaterial common stock investment in the audit client. d. The partner in charge of the office's compensation is affected by office profitability, a portion of which arises from this audit.

Description : In which circumstance is a CPA firm's independence most likely to be impaired? a. An individual on the audit has a close relative who is a receptionist for the client. b. The father of ... of the office's compensation is affected by office profitability, a portion of which arises from this audit.

Last Answer : The spouse of a staff member on the audit has an immaterial common stock investment in the audit client.

________ is characteristic of liquidity ratios. (a) Organization’s ability to meet its current debt obligations (b) Organization’s use of debt to finance its assets and whether it’s able to meet the interest payments on the debt ;(c) How efficiently the firm is using its assets ;(d) None of given options

Description : ________ is characteristic of liquidity ratios. (a) Organization's ability to meet its current debt obligations (b) Organization's use of debt to finance its assets and whether it's able to meet the interest ... the debt ;(c) How efficiently the firm is using its assets ;(d) None of given options

Last Answer : (a) Organization’s ability to meet its current debt obligations 

Ratios may be used as a measure of ------------- a) Effiency b) Solvency c) Profitability d) None of the above

Description : Ratios may be used as a measure of ------------- a) Effiency b) Solvency c) Profitability d) None of the above

Last Answer : a) Effiency

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

Description : 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

Last Answer : c) Cash flow statement

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.

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.

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.

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.

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

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

Last Answer : Profitability

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. expected profitability to increase, whereas risk would decrease C. liquidity would increase, whereas risk would also increase D. risk and profitability to

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

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.

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.

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

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

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.

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.

-------- helps to disclose financial position a) Trial Balance b) Profit and Loss Account c) Balance sheet d) Income Statement

Description : -------- helps to disclose financial position a) Trial Balance b) Profit and Loss Account c) Balance sheet d) Income Statement

Last Answer : -------- helps to disclose financial position a) Trial Balance b) Profit and Loss Account c) Balance sheet d) Income Statement

Comparison of financial statements highlights the trend of the _________ of the business. A. Financial position B. Performance C. Profitability D. All of the above

Description : Comparison of financial statements highlights the trend of the _________ of the business. A. Financial position B. Performance C. Profitability D. All of the above

Last Answer : D. All of the above

Which one of the following statements is correct ? When creditors' velocity or creditors' turnover is higher as compared to debtors' velocity, it would (A) improve liquidity (B) reduce liquidity (C) have no effect on liquidity (D) improve financial position

Description : Which one of the following statements is correct ? When creditors' velocity or creditors' turnover is higher as compared to debtors' velocity, it would (A) improve liquidity (B) reduce liquidity (C) have no effect on liquidity (D) improve financial position

Last Answer : Answer: have no effect on liquidity

For the financial year ended as on March 31, 2013 the figures extracted from the balance sheet of Xerox Limited as under: Opening Stock Rs. 29,000; Purchases Rs. 2,42,000; Sales Rs. 3,20,000; Gross Profit 25% of Sales. Stock Turnover Ratio will be :- (a) 8 times (b) 6 times (c) 9 times (d) 10 times

Description : For the financial year ended as on March 31, 2013 the figures extracted from the balance sheet of Xerox Limited as under: Opening Stock Rs. 29,000; Purchases Rs. 2,42,000; Sales Rs. 3,20,000; Gross Profit 25% of ... Stock Turnover Ratio will be :- (a) 8 times (b) 6 times (c) 9 times (d) 10 times

Last Answer : (a) 8 times

Ratio analysis is a study of relationship among various --------------- factors in a business a) Operational b) Official c) Financial d) Others

Description : Ratio analysis is a study of relationship among various --------------- factors in a business a) Operational b) Official c) Financial d) Others

Last Answer : c) Financial

Powerful tool for analyzing financial statement is ---------- a) Trend analysis b) Ratio analysis c) Analysis d) Interpretation

Description : Powerful tool for analyzing financial statement is ---------- a) Trend analysis b) Ratio analysis c) Analysis d) Interpretation

Last Answer : b) Ratio analysis

Yard stick which measures relationship between two variables a) Financial statements b) Ratio c) Fund Flow analysis d) Cash flow analysis

Description : Yard stick which measures relationship between two variables a) Financial statements b) Ratio c) Fund Flow analysis d) Cash flow analysis

Last Answer : b) Ratio

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

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

Example of activity ratios ------------------------ a) Gross profit ratio b) Net profit ratio c) Operating ratio d) Stock turn over ratio

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

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

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

A statement depicting the reasons for the change in cash position from one period to another a) Fund flow statement b) Statement of uses and application of funds c) Cash flow statement d) Ratio analysis

Description : A statement depicting the reasons for the change in cash position from one period to another a) Fund flow statement b) Statement of uses and application of funds c) Cash flow statement d) Ratio analysis

Last Answer : a) Fund flow statement