Which of the Following Ratios Does NOT Measure Efficiency or Activity

question 5

Multiple Choice

Which of the following ratios does NOT measure efficiency or activity of an entity?

• A) Accounts receivable turnover
• B) Age of accounts receivable
• C) Net cash flow to current liabilities
• D) Times interest earned

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Definitions:

Oral Contract

is an agreement between parties that is spoken and not written down, yet is legally binding, provided it can be proven to exist and meets legal requirements.

Written Memorandum

A document recording the terms of a contract or agreement, not necessarily formalized but intended as a binding outline of intent between parties.

Course of Performance

A term used in contract law referring to the conduct between parties that can help interpret the agreement's terms over time.

Express Terms

Specific conditions and provisions explicitly stated in a contractual agreement.