Which of the Following Ratios Are Measures of a Firm's

question 57

Multiple Choice

Which of the following ratios are measures of a firm's liquidity?
I.cash coverage ratio
II.interval measure
III.debt-equity ratio
IV.quick ratio

• A)I and III only
• B)II and IV only
• C)I, III, and IV only
• D)I, II, and III only
• E)I, II, III, and IV

Distinguish between items that belong on the income statement versus those that belong on the balance sheet.

Journalize closing entries from adjusted trial balances and understand their role in the accounting cycle.

Explain the purpose and use of end-of-period spreadsheets in accounting processes.

Determine a company’s current ratio and understand its implications for short-term solvency.

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Definitions:

Efficiency

The ability to achieve a desired result without wasted energy or resources.

Quantity of Money

The sum of cash and bank deposits circulating in an economy at a particular moment.

Prices

Prices are the amounts of money required to purchase goods or services, serving as a reflection of supply and demand dynamics in a market.

Opportunity Cost

The loss of what could have been earned from other possibilities when one path is taken.