55 The current ratio excludes a accrued interest b inventory c cash equivalents d retained earnings 56 A high current ratio suggests that the firm a has a small amount of longterm debt b is carrying little inventory c is able to meet its current obligations d is profitable 57 An increase in the days sales outstanding implies a an increase in inventory b receivables turn into cash more rapidly c receivables turn into cash more slowly d the price of the product has been reduced 58 Performance is measured by a liquidity ratios b leverage ratios c profitability ratios d turnover ratios 59 Leverage ratios measure a extent to which the firm uses debt financing b the speed with which the firm sells inventory c sales relative to some base such as equity d capacity of the firm to meet current obligations 62 If a firm collects its accounts receivable, a the current ratio increases b inventory turnover increases c the average collection period (days sales outstanding) is reduced d inventory is reduced 63 Profitability ratios measure a liquidity b leverage c performance d turnover 65 The more rapidly receivables turn over a the more rapidly the firm is receiving cash b the larger are the firm's sales c the smaller is the firm's inventory d the larger are the firm's accounts payable 66 The larger the debt ratio a the more equity the firm is using b the riskier the firm becomes c the larger are the firm's total assets d the smaller is the firm's use of financial leverage

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Question: 55. The current ratio excludes a. accrued interest b. inventory c. cash equivalents d. retained earnings 56. A high current ratio suggests that the firm

55. The current ratio excludes

	a.	accrued interest
	b.	inventory
	c.	cash equivalents
	d.	retained earnings

56. A high current ratio suggests that the firm

	a.	has a small amount of longterm debt
	b.	is carrying little inventory
	c.	is able to meet its current obligations
	d.	is profitable

57. An increase in the days sales outstanding implies

	a.	an increase in inventory
	b.	receivables turn into cash more rapidly
	c.	receivables turn into cash more slowly
	d.	the price of the product has been reduced

58. Performance is measured by

	a.	liquidity ratios
	b.	leverage ratios
	c.	profitability ratios
	d.	turnover ratios

59. Leverage ratios measure

	a.	extent to which the firm uses debt financing
	b.	the speed with which the firm sells inventory
	c.	sales relative to some base such as equity
	d.	capacity of the firm to meet current obligations

62. If a firm collects its accounts receivable,

	a.	the current ratio increases
	b.	inventory turnover increases
	c.	the average collection period (days sales outstanding) is reduced
	d.	inventory is reduced

63. Profitability ratios measure

	a.	liquidity
	b.	leverage
	c.	performance
	d.	turnover

65. The more rapidly receivables turn over

	a.	the more rapidly the firm is receiving cash
	b.	the larger are the firm's sales
	c.	the smaller is the firm's inventory
	d.	the larger are the firm's accounts payable

66. The larger the debt ratio

	a.	the more equity the firm is using
	b.	the riskier the firm becomes
	c.	the larger are the firm's total assets
	d.	the smaller is the firm's use of financial leverage

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