What is the primary purpose of ratio analysis in financial statement analysis?

Financial Statement Analysis Quiz

Quiz
•
Business
•
11th Grade
•
Easy

Sharita Bukirwa
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62 questions
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1.
MULTIPLE CHOICE QUESTION
30 sec • 1 pt
To determine tax liabilities
To obtain a quick indication of a business’s financial performance
To calculate employee salaries
To forecast future market trends
2.
MULTIPLE CHOICE QUESTION
30 sec • 1 pt
Which financial document is used in ratio analysis to assess profit and loss?
Cash flow statement
Statement of changes in equity
Statement of comprehensive income
Statement of retained earnings
3.
MULTIPLE CHOICE QUESTION
30 sec • 1 pt
Which financial document is referred to as the balance sheet in ratio analysis?
Statement of cash flows
Statement of financial position
Statement of comprehensive income
Statement of changes in equity
4.
MULTIPLE CHOICE QUESTION
30 sec • 1 pt
What is one of the key uses of ratio analysis in a business?
To measure the market share of the business
To measure the liquidity of the business
To measure the employee satisfaction
To measure the environmental impact
5.
MULTIPLE CHOICE QUESTION
30 sec • 1 pt
How does ratio analysis help in understanding a business's profitability?
By assessing the business's market trends
By evaluating the business's customer base
By measuring how efficient the business is at making a profit
By analyzing the business's social media presence
6.
MULTIPLE CHOICE QUESTION
30 sec • 1 pt
Which aspect of a business's performance is assessed by ratio analysis?
How well it uses its resources
How innovative its products are
How diverse its workforce is
How strong its brand is
7.
MULTIPLE CHOICE QUESTION
30 sec • 1 pt
What does liquidity refer to in a business context?
The ability to turn assets into cash
The ability to increase profits
The ability to expand market share
The ability to reduce liabilities
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