8. Performance Evaluation

Ratio Analysis — Quiz

Test your understanding of ratio analysis with 5 practice questions.

Practice Questions

Question 1

Which ratio is used to assess a company's ability to meet its long-term financial obligations?

Question 2

A company has total assets of $$ \$1,000,000 $ and total liabilities of $ \$400,000 $$. What is its shareholder's equity?

Question 3

Which of the following would be most useful for assessing how efficiently a business is managing its accounts receivable?

Question 4

If a company's sales revenue is $$ \$800,000 $ and its gross profit is $ \$320,000 $$, what is its gross profit margin?

Question 5

What does a high asset turnover ratio generally indicate about a company?