If Your Goal Is Determine How Effectively a Firm Is

question 81

Multiple Choice

If your goal is determine how effectively a firm is managing its assets, which of the following sets of ratios would you examine?

• A)profit margin, current ratio, fixed charge coverage ratio
• B)quick ratio, debt ratio, time interest earned
• C)inventory turnover ratio, days sales outstanding, fixed asset turnover ratio
• D)total assets turnover ratio, price earnings ratio, return on total assets
• E)time interest earned, profit margin, fixed asset turnover ratio

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Definitions:

Actual Cause

The determination that the defendant’s breach of duty resulted directly in the plaintiff’s injury.

Duty Of Care

The legal obligation to exercise a level of caution and attention to avoid harm to others or their property.

Malpractice

Professional misconduct or failure to exercise adequate levels of care, skill, or diligence, resulting in harm to another.

Reasonable Person

A hypothetical individual used as a legal standard to determine the appropriateness of an action in light of what a typical person would deem reasonable under similar circumstances.