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Various Ratios Are Computed to Assess Different Aspects of a Company's

Question 131

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Various ratios are computed to assess different aspects of a company's financial condition and (or)strength.
Required:
In the table below,indicate which aspect of financial condition each specified ratio is designed to assess:  Stock  Ratio  Liquidity  Solvency  Profitability  Market  1.  Accounts receivable tumover  2.  Average days to collect receivables 3. Book value per share  4.  Current ratio  5.  Debt to equity ratio 6. Dividend yield 7. Earnings per share  8.  Inventory turnover  9.  Net margin  10.  Average days to sell inventory  11.  Number of times interest is earned  12.  Plant assets to long-term liabilities  13.  Price-eamings ratio  14.  Quick ratio  15.  Return on equity  16.  Return on investment  17.  Debt to assets ratio  18.  Asset turnover ratio  19.  Working capital \begin{array}{|l|l|l|l|l|l|}\hline & & &&& \text { Stock } \\\hline &\text { Ratio }& \text { Liquidity } & \text { Solvency } & \text { Profitability } & \text { Market } \\\hline \text { 1. } & \text { Accounts receivable tumover } \\\hline \text { 2. } & \text { Average days to collect receivables } \\\hline 3 . & \text { Book value per share } \\\hline \text { 4. } & \text { Current ratio } \\\hline \text { 5. } & \text { Debt to equity ratio } \\\hline 6 . & \text { Dividend yield } \\\hline 7 . & \text { Earnings per share } \\\hline \text { 8. } & \text { Inventory turnover } \\\hline \text { 9. } & \text { Net margin } \\\hline \text { 10. } & \text { Average days to sell inventory } \\\hline \text { 11. } & \text { Number of times interest is earned } \\\hline \text { 12. } & \text { Plant assets to long-term liabilities } \\\hline \text { 13. } & \text { Price-eamings ratio } \\\hline \text { 14. } & \text { Quick ratio } \\\hline \text { 15. } & \text { Return on equity } \\\hline \text { 16. } & \text { Return on investment } \\\hline \text { 17. } & \text { Debt to assets ratio } \\\hline \text { 18. } & \text { Asset turnover ratio } \\\hline \text { 19. } & \text { Working capital } \\\hline\end{array}

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