The Following Question Relates to PQR,which Has the Following Ratios

question 16

Multiple Choice

The following question relates to PQR,which has the following ratios: return on assets, (ROA) 10 per cent;return on equity (ROE) 12 per cent;and current ratio (CR) of 1.8:1.
-Additional credit sales of $2 million (cost price $1.5 million) are made.This transaction will:

• A) increase ROA,ROE and CR.
• B) increase ROA and ROE but not CR.
• C) increase ROA and CR but not ROE.
• D) increase ROA,increase ROE and decrease CR.

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Definitions:

Average Time

The mean value calculated by dividing the sum of all time intervals by the number of intervals.

Hold Times

The duration an entity (such as a caller in a queue or a product within a process) waits before the next action in a sequence is taken.

Test Statistic

A value calculated from sample data used to decide whether to reject the null hypothesis in statistical hypothesis testing.

Average Monthly Cost

The mean expenditure incurred per month over a specified period, often used for budgeting and planning purposes.