Question Details

Stockholders are most interested in evaluating 


1. Stockholders are most interested in evaluating 
a. liquidity.
b. solvency.
c. profitability.
d. marketability.
2. In ratio analysis, the ratios are never expressed as a
a. rate.
b. logarithm.
c. percentage.
d. simple proportion.
3. The current ratio is
a. calculated by dividing current liabilities by current assets.
b. used to evaluate a company's liquidity and short-term debt paying ability.
c. used to evaluate a company's solvency and long-term debt paying ability.
d. calculated by subtracting current liabilities from current assets.
4. The acid-test or quick ratio
a. is used to quickly determine a company's solvency and long-term debt paying ability.
b. relates cash, short-term investments, and net receivables to current liabilities.
c. is calculated by taking one item from the income statement and one item from the
balance sheet.
d. is the same as the current ratio except it is rounded to the nearest whole percent.
5. Winter Clothing Store had a balance in the Accounts Receivable account of $390,000 at
the beginning of the year and a balance of $410,000 at the end of the year. Net credit
sales during the year amounted to $4,000,000. The average collection period of the
receivables in terms of days was
a. 30 days.
b. 365 days.
c. 73 days.
d. 37 days.



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