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

question 94

Multiple Choice

Which type of financial ratio is computed by dividing the organization's current assets by its current 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:

Compelling Government Purpose

A legal concept referring to a reason the government may use to justify the imposition of restrictions that might otherwise infringe on individual rights, provided it is necessary for a significant public goal.

Separation of Powers

A foundational principle of governance where the state's responsibilities are divided among different branches, typically the legislative, executive, and judicial branches, to prevent the concentration of power.

Federal Courts

Courts established by the federal government of a country, with the authority to hear disputes that fall under federal law or involve parties from different states.

Interstate Commerce

Involves trade, traffic, or transportation of goods or services across state lines within the United States.