#1
Which financial statement provides a snapshot of a company's financial position at a specific point in time?
Balance sheet
ExplanationSnapshot of financial position
#2
What does the current ratio measure?
A company's liquidity
ExplanationMeasure of liquidity
#3
Which of the following is not considered a liquidity ratio?
Debt ratio
ExplanationNot a liquidity measure
#4
What does the cash ratio measure?
A company's ability to pay off its current liabilities with its most liquid assets
ExplanationAbility to pay current liabilities with cash and cash equivalents
#5
Which of the following is an indicator of a company's liquidity?
Quick ratio
ExplanationIndicator of liquidity
#6
What does the acid-test (quick) ratio measure?
A company's ability to pay off its current liabilities with its most liquid assets
ExplanationAbility to pay current liabilities with liquid assets
#7
Which of the following is an efficiency ratio?
Inventory turnover ratio
ExplanationEfficiency in inventory management
#8
What does the inventory turnover ratio measure?
The number of times a company's inventory is sold and replaced over a period
ExplanationFrequency of inventory turnover
#9
Which financial ratio indicates the number of times a company can pay its current liabilities with its current assets?
Current ratio
ExplanationTimes to pay current liabilities with current assets
#10
Which financial ratio indicates the percentage of a company's assets financed by debt?
Debt ratio
ExplanationPercentage of assets financed by debt
#11
What does the return on equity (ROE) ratio measure?
A company's profitability relative to its equity
ExplanationProfitability relative to equity
#12
Which of the following is a liquidity ratio?
Cash ratio
ExplanationMeasure of liquidity