Match the Following Types of Ratios with Their Definitions

question 5

Multiple Choice

Match the following types of ratios with their definitions.
-__ Liquidity

• A) assess whether an organization is maintaining an adequate level of cash or near-cash assets.
• B) assess how well an organization did financially.
• C) compares numbers on the balance sheet to total assets and numbers on operating statement to revenues.
• D) assess the organization's ability to meet its financial debt obligations (principal and interest).
• E) assess how well an organization manages its activities.

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Definitions:

Noncontrolling Interest

A shareholder's equity in a corporation that is less than the threshold required for control usually presented in consolidated financial statements.

Fiscal Year

A 12-month period used for accounting purposes and preparing financial statements, differing from the calendar year for some organizations.

Consolidated Financial Statement

A comprehensive financial statement that presents the overall financial position of a parent company and its subsidiaries as one single entity.

Pre-acquisition Earnings

Earnings accumulated by a company prior to being acquired by another entity.