Question Details

Which one of the following would be considered a leverage ratio



1.	A company has a receivables turnover of 15 times. The average net receivables during the period are $430,000. What is the amount of net credit sales for the period?
a.	$430,000
b.	$6,450,000
c.	$6,000,000
d.	$500,000


	
	2.	A company has an average inventory on hand of $100,000 and the days in inventory are 73 days. What is the cost of goods sold?
a.	$500,000
b.	$7,300,000
c.	$1,000,000
d.	$3,650,000

	


	3.	Which one of the following would be considered a leverage ratio?
a.	accounts receivable turnover
b.	return on total assets
c.	quick ratio
d.	debt ratio


	

	4.	Grant Company reported the following on its income statement:

Income before income taxes	$420,000
Income tax expense	  120,000
Net income	$300,000

An analysis of the income statement revealed that interest expense was $60,000. Grant Company's times-interest-earned ratio was
a.	8.
b.	7.
c.	6.
d.	5.


	

	5.	Last year Neil Company had a net income of $170,000, income tax expense of $37,000, and interest expense of $24,000. The company's times-interest-earned ratio was closest to
a.	8.63.
b.	7.08.
c.	9.63.
d.	6.24.




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