Study questions bmal324 a1

1.Total current assets / current liabilities = ______________.

• current ratio
• return on equity
• return on investment
• accounts payable turnover ratio

2.An example of a market valuation is

• Return on equity ratio
• Acid test ratio
• Gross profit ratio
• Price to earnings ratio

3.Ratio that tells us the profitability of the company in relation to how much was earned on the assets for the period

• Return on assets
• Return on equity
• Net profit margins
• Current ratio

4.Common-size analysis is usually just a starting point for even greater analysis and inquiry.

• True
• False

5.With ___________ analysis, you choose a particular base year and set every single figure in that year's financial statement equal to 100%. You then look at subsequent years, comparing each individual line in the financial statements to the base year and dividing one by the other.

• ratio
• trend
• common-size
• turnover

6.Which of the following is a category in ratio analysis?

• market ratios
• profitability ratios
• liquidity ratios
• All of the above.

7.The _____________ analysis involves taking all of the absolute figures on the company's financial statements and converting them to percentages.

• ratio
• trend
• common-size
• All of the above.