Identify which question each of the following ratios helps answer. 1. Is the business a going concern?

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Identify which question each of the following ratios helps answer.
1. Is the business a going concern?
2. How is the business earning a net income or loss?
3. Where is the business getting its money and can it pay its debt obligations?
4. How is the business investing its money and is it using its assets efficiently?
5. Is the business generating enough net income to reward the stockholders for the use of their money?
_____ a Inventory turnover
_____ b Debt ratio
_____ c Return on equity
_____ d Fixed asset turnover
_____ e Quick ratio
_____ f Return on assets
_____ g Gross profit percentage
_____ h Accounts receivable turnover
_____ i Current ratio
_____ j Earnings per share
_____ k Interest coverage ratio
_____ l Net income percentage
_____ m Cash conversion cycle
_____ n Dividends per share
_____ o Total asset turnover

Cash Conversion Cycle
Cash conversion cycle measures the total time a business takes to convert its cash on hand to produce, pay its suppliers, sell to its customers and collect cash from its customers. The process starts with purchasing of raw materials from suppliers,...
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.
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Financial Accounting

ISBN: 978-0133052152

2nd edition

Authors: Robert Kemp, Jeffrey Waybright

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