Match Each Ratio That Follows to Its Use (Items A-H)

question 177

Multiple Choice

Match each ratio that follows to its use (items a-h) . Items may be used more than once.
-Dividends per share

• A)Assess the profitability of the assets
• B)Assess how effectively assets are used
• C)Indicate the ability to pay current liabilities
• D)Indicate how much of the company is financed by debt and equity
• E)Indicate instant debt-paying ability
• F)Assess the profitability of the investment by common stockholders
• G)Indicate future earnings prospects
• H)Indicate the extent to which earnings are being distributed to common stockholders

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Definitions:

Compensation Costs

The total expenses incurred by an employer to provide wages, salaries, and benefits to their employees.

Outsourcing

The practice of hiring third parties to perform services, handle operations or provide goods that are traditionally executed or produced in-house.

Economies of Scale

Cost advantages that a business can achieve due to expansion, leading to a reduction in the per unit cost as production scales up.

Compensation Policies

Guidelines and strategies a company uses to determine how employees are paid, including salaries, bonuses, and benefits, ensuring fair and competitive remuneration.