You Are Provided This Information About a Retail Store Called

question 26

Multiple Choice

You are provided this information about a retail store called "BoardSports:" BoardSports Industry Mean
Current Ratio 1.5 : 1 2: 1
Quick ratio .75 : 1 1 : 1
Debt ratio 0.87 : 1 0.75 : 1
Average collection ratio 46 days 33 days
Net profit on sales ratio 5.5% 8.2%
Net profit to equity ratio 7.7% 13.2%
What can you reasonably assess about the current financial status of this company?

• A)The company is in excellent financial condition with no changes required.
• B)The company is in respectable financial condition with no changes required.
• C)The company is in questionable financial condition with minor changes required.
• D)The company is in poor financial condition with significant changes required.

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Definitions:

Type A

A behavior pattern characterized by competitiveness, urgency, aggression, and impatience, which is associated with stress and heart disease.

Type B

refers to a personality type characterized by less competitive, more relaxed, and less easily stressed attitudes than Type A.

Hostility

A state of antagonism, anger, or aggression toward others, which can manifest in both emotional and behavioral aspects.

Impatience

A lack of patience; irritation with anything that causes delay.