Fixed assets ratio is a
A)short-term solvency ratio.
B)long-term solvency ratio.
C)profitability ratio.
D)turnover ratio.

Question

Quizplus · Accepted Answer

Fixed assets ratio, also known as the fixed asset turnover ratio, is considered a long-term solvency ratio because it measures a company's ability to generate net sales from fixed-asset investments - specifically property, plant, and equipment (PP&E) - which are long-term in nature.

Fixed Assets Ratio Is a