#1
What does the Inventory Turnover Ratio indicate in supply chain management?
The rate at which a company sells and replaces inventory
ExplanationIndicates how quickly a company sells and replenishes its inventory.
#2
What does the term 'Working Capital' refer to in financial management?
The difference between current assets and current liabilities
ExplanationRepresents the surplus of current assets over current liabilities.
#3
What does the Debt-to-Equity Ratio indicate about a company's financial structure?
The proportion of debt and equity financing used by the company
ExplanationIndicates the balance between debt and equity in a company's financing.
#4
Which of the following financial metrics measures how efficiently a company uses its assets to generate revenue?
Asset Turnover Ratio
ExplanationMeasures the efficiency of asset utilization in revenue generation.
#5
In financial analysis, what does the term 'Days Payables Outstanding (DPO)' represent?
The average time it takes for a company to pay its suppliers
ExplanationRepresents the average time taken by a company to settle payments with suppliers.
#6
What is the formula for calculating Return on Investment (ROI)?
(Net Profit / Total Assets) * 100
ExplanationCalculates the percentage return on investment based on net profit and total assets.
#7
Which financial metric measures the ability of a company to generate profit from its shareholders' equity?
Return on Equity (ROE)
ExplanationMeasures the profit generation capability from shareholders' equity.
#8
Which financial metric assesses the liquidity of a company by comparing its current assets to its current liabilities?
Quick Ratio
ExplanationMeasures liquidity by comparing quick assets to current liabilities.
#9
Which of the following is NOT a component of the Cash Conversion Cycle (CCC) in supply chain management?
Return on Investment (ROI)
ExplanationNot a component of the Cash Conversion Cycle; unrelated to the cycle's components.