Match the Letter for the Following Ratio Measures to the Category

question 33

Essay

Match the letter for the following ratio measures to the category of performance that the ratio is used to measure.
P - Profitability
L - Liquidity
S - Solvency
___ Debt-to-assets ratio
___ Receivables turnover ratio
___ Fixed asset turnover ratio
___ Current ratio
___ Return on equity
___ Capital acquisitions ratio
___ Times interest earned ratio
___ Quality of income ratio
___ Inventory turnover ratio
___ Earnings per share

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Definitions:

Salvage Value

An asset's anticipated value at the end of its operational life, as estimated.

Straight Line Method

A method of calculating depreciation by evenly spreading the cost of an asset over its useful life.

Average Accounting Rate of Return

A method to estimate the profitability of investments, calculated by dividing the average annual profit by the initial investment cost.