Chapter 22 Profitability and liquidity ratios

Chapter 22 Profitability and liquidity ratios

10th - 11th Grade

22 Qs

quiz-placeholder

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Chapter 22 Profitability and liquidity ratios

Chapter 22 Profitability and liquidity ratios

Assessment

Quiz

Business

10th - 11th Grade

Hard

Created by

grayce lim

Used 52+ times

FREE Resource

22 questions

Show all answers

1.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

State the following statement True or False.

Ratios help in comparisons of a firm’s results over a number of accounting periods as well as with other business enterprises.

True

False

2.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

State the following statement True or False.

A ratio reflects quantitative and qualitative aspects of results.

True

False

3.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

The _________ of business firm is measured by its ability to satisfy its short term obligations as they become due.

Activity

Liquidity

profitability

Solvency

4.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

The two basic measures of liquidity are:

inventory turnover and current ratio

current ratio and liquid ratio

gross margin and profit margin

current ratio and trade receivables turnover

5.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

The _________ is a measure of liquidity which excludes _______, generally the least liquid asset.

Current ratio, trade receivable

Liquid ratio, trade receivable

Current ratio, inventory

Liquid ratio, inventory

6.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

What ratio shows how well a business can turn revenue into gross profit?

Net profit margin

Gross profit margin

Current ratio

Acid test ratio

7.

MULTIPLE SELECT QUESTION

30 sec • 1 pt

Media Image

Which of the following statements are correct? (you should select two only!)

Nairobi Press Ltd's gross profit margin = 40%

Nairobi Press Ltd's net profit margin= 25%

Nairobi Press Ltd's gross profit margin = 50%

Nairobi Press Ltd's net profit margin = 20%

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