What is defined as the current assets minus inventories and prepaid expenses ? A. Profit margin ratio B. Price-earnings ratio C. Return of investment ratioD. Quick ratio

The common ratio is the ratio of_______________? A. Net credit sales to average net receivableB. Current assets to current liabilities C. Gross profit to net sales D. Net income to owner’s equity

What is an index of short-term paying ability ? A. Price-earnings ratioB. Current ratio C. Profit margin ratio D. Gross margin

The financial health of the company is measured in terms of______________? A. Liquidity B. Solvency C. Relative riskD. All of the above

What is the basic accounting equation ? A. Assets = liability + owner’s equity B. Liability = assets + owners’ equity C. Owner’s equity = assets + liability D. Owner’s equity = liability – assets

The ability to convert assets to cash quickly is known as ________________? A. SolvencyB. Liquidity C. Leverage D. Insolvency

The ability to meet debts as they become due is known as __________________? A. Solvency B. Leverage C. Insolvency D. Liquidity

What is a stock of a product which is held by a trade body or government as a means of regulating the price of that product ? A. Stock pile B. Hoard stockC. Buffer stock D. Withheld stock

A form of business firm which is owned and run by a group of individuals for their mutual benefit is called ___________________? A. Cooperative B. Corporation C. Enterprise D. Partnership

What is a government bond which has an indefinite life rather than a specific maturity ? A. Coupon B. T-bill C. DebentureD. Consol