Identify which of the following six metrics a through f best completes questions 1 through 3 below.

Question:

a. Days’ sales uncollected

c. Working capital

d. Return on total assets

e. Total asset turnover
f. Profit margin

1. Which two ratios are key components in measuring a company’s operating efficiency? ___________Which ratio summarizes these two components? ___________

2. What measure reflects the difference between current assets and current liabilities?

3. Which two short-term liquidity ratios measure how frequently a company collects its accounts? ___________

Accounts Receivable
Accounts receivables are debts owed to your company, usually from sales on credit. Accounts receivable is business asset, the sum of the money owed to you by customers who haven’t paid.The standard procedure in business-to-business sales is that... Asset Turnover
Asset turnover is sales divided by total assets. Important for comparison over time and to other companies of the same industry. This is a standard business ratio.