4. Finance
Ratio Analysis — Quiz
Test your understanding of ratio analysis with 5 practice questions.
Practice Questions
Question 1
A company has total liabilities of $300,000 and total equity of $700,000. What is its Gearing Ratio using the formula: (Total Liabilities / (Total Liabilities + Total Equity)) × 100?
Question 2
A business has average receivables of $60,000 and annual credit sales of $720,000. What is its Receivables (Debtor) Days ratio?
Question 3
A company has an Operating Profit of $200,000, Interest Expense of $40,000, and Tax Expense of $20,000. What is its Interest Coverage Ratio?
Question 4
If a company’s average payables are $50,000 and its credit purchases are $300,000, what is its Payables (Creditor) Days ratio?
Question 5
A business has total equity of $500,000 and total debt of $800,000. What is its Gearing Ratio using the formula: (Total Debt / (Total Debt + Total Equity)) × 100?