Match the ratio with the information it provides
Current Ratio -
Quick Ratio -
Working Capital -
Gross Profit Margin -
Operating Profit Margin -
Net Profit Margin -
Total Debt to Assets Ration -
Long-term Debt to Assets Ratio -
Total Debt to Equity Ration -
Answers:
Demonstrates the relationship between current assets and current liabilities
Compares net income to net sales
Demonstrates the amount of current assets that would be left to run the company on should all of the current liabilities be paid off.
Examines the relationship between specific current assets, called quick assets, and current liabilities.
Compares the gross profit (sometimes called gross margin) to net sales.
Compares the income from operations with net sales. The formula for this ratio is.
Measures the relationship between the total debt and the assets that back up that debt.
The key financial ratio used to determine a company's financial standing.
Indicates how much of a company's assets are finances by loans that will take more than a year to repay.
choose the correct answer
Current Ratio - Demonstrates the relationship between current assets and current liabilities
Quick Ratio - Examines the relationship between specific current assets, called quick assets, and current liabilities.
Working Capital - Demonstrates the amount of current assets that would be left to run the company on should all of the current liabilities be paid off.
Gross Profit Margin - Compares the gross profit (sometimes called gross margin) to net sales.
Operating Profit Margin - Compares the income from operations with net sales. The formula for this ratio is.
Net Profit Margin - Compares net income to net sales
Total Debt to Assets Ratio - Measures the relationship between the total debt and the assets that back up that debt.
Long-term Debt to Assets Ratio - Indicates how much of a company's assets are finances by loans that will take more than a year to repay.
Total Debt to Equity Ratio - The key financial ratio used to determine a company's financial standing.