Which Type of Financial Ratio Is Computed by Dividing the Organization's

question 28

Multiple Choice

Which type of financial ratio is computed by dividing the organization's present assets by its present liabilities?

• A)inventory turnover ratio
• B)days sales outstanding ratio
• C)profit ratio
• D)current ratio
• E)debt-to-assets ratio

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Definitions:

Dividends

Payments made by a corporation to its shareholders from the earnings of the company, usually in the form of cash or stocks.

Shares

Holdings in a corporation or financial asset, these units confer rights to an equitable distribution of dividends from declared profits.

Quarterly Dividend

A dividend paid by a company to its shareholders every quarter, representing a portion of the company's earnings.

Capital Gains

The profit earned from the sale of an asset or investment which has increased in value over the holding period.