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Match the Ratio with the Ratio Computation

Question 168

Matching

Match the ratio with the ratio computation.

Premises:
Return on equity
Return on assets
Financial leverage
EPS
Profit margin
Current ratio
Quick ratio
Receivables turnover ratio
Inventory turnover ratio
Debt/equity ratio
Owners' equity to total equities
Creditors' equity to total equities
Price/earnings ratio
Dividend yield ratio
Book value per common share
Cash coverage ratio
Cash ratio
Quality of earnings
Times interest earned
Fixed asset turnover ratio
Responses:
Profit ÷ Net sales revenue
Net credit sales ÷ Average net receivables
Return on equity - Return on assets
Sales revenue ÷ Total operating expenses
Total liabilities ÷ Shareholders' Equity
Market price per share ÷ EPS
Profit ÷ Average shareholders' equity
Creditors' equity ÷ Total equities
Income tax expense ÷ Pretax income
Quick assets ÷ Current liabilities
Sales revenue ÷ Total assets
Dividends per share ÷ Market price per share
Shareholders' equity ÷ Total equities
Cost of goods sold ÷ Average inventory
(Income + After-tax interest expense) ÷ Total assets
Current assets ÷ Current liabilities
Profit ÷ Average number of shares of common share outstanding
(Cash + Cash equivalents) ÷ Current liabilities
Cash Flows from Operating Activities ÷ Profit
(Profit + Interest + Income Tax Expense) ÷ Interest Expense
Net Sales Revenue ÷ Net Fixed Assets
Cash Flows from Operating Activities (before interest and tax expense) ÷ Interest Paid
Not given above.

Correct Answer:

Profit ÷ Net sales revenue
Net credit sales ÷ Average net receivables
Return on equity - Return on assets
Sales revenue ÷ Total operating expenses
Total liabilities ÷ Shareholders' Equity
Market price per share ÷ EPS
Profit ÷ Average shareholders' equity
Creditors' equity ÷ Total equities
Income tax expense ÷ Pretax income
Quick assets ÷ Current liabilities
Sales revenue ÷ Total assets
Dividends per share ÷ Market price per share
Shareholders' equity ÷ Total equities
Cost of goods sold ÷ Average inventory
(Income + After-tax interest expense) ÷ Total assets
Current assets ÷ Current liabilities
Profit ÷ Average number of shares of common share outstanding
(Cash + Cash equivalents) ÷ Current liabilities
Cash Flows from Operating Activities ÷ Profit
(Profit + Interest + Income Tax Expense) ÷ Interest Expense
Net Sales Revenue ÷ Net Fixed Assets
Cash Flows from Operating Activities (before interest and tax expense) ÷ Interest Paid
Not given above.
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