For Each of the Following Financial Ratios That Are Based

question 41

Essay

For each of the following financial ratios that are based on comprehensive annual financial report (CAFR) information by selecting the appropriate letter of the explanation for that ratio. Answers can only be used once.
A. An indicator of interperiod equity.
B. An indicator of the government's commitment to replacement of capital assets.
C. An indicator of the government's reliance on revenues it does not directly control.
D. A measure of the degree to which government assets have been funded with debt.
E. An indicator of the government's ability to pay its 60- to 90-day obligations.
F. A measure of the government's capacity to issue debt.
G. A measure of capital asset useful service life.
H. A measure of the government's liquidity.
I. An indicator of taxpayer debt burden.
J. An indicator of the government's ability to withstand financial emergencies.
________ 1. General fund balances/General Fund operating revenues
________ 2. (Cash + short-term investments)/Current liabilities
________ 3. General obligation long-term debt/Assessed valuation
________ 4. Capital outlay from operating funds/Operating expenditures
________ 5. General bonded debt/Legal debt limit
________ 6. Accumulated depreciation/Average cost of depreciable assets
________ 7. Net revenues/Total expenses
________ 8. Charges for services/Total revenues
________ 9. Total liabilities/Total assets
________ 10. Current assets/Current liabilities

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Definitions:

Possible Outcomes

The set of all distinct outcomes that can result from a particular statistical experiment or random event.

Events

Occurrences or happenings, especially significant ones that can be statistically analyzed.

Possible Outcomes

Refers to all the potential results that can occur in any probabilistic or random event.

Probability

The measure of the likelihood that an event will occur, expressed as a number between 0 and 1.