Multiple Choice QuestionSince converting the firm's inventory to profits is a key function of management, firms use ______ to measure the effectiveness of management in utilizing the assets that are available.Multiple choice question.activity ratiosliquidity ratiosdebt ratiosleverage ratios
Question
Multiple Choice QuestionSince converting the firm's inventory to profits is a key function of management, firms use ______ to measure the effectiveness of management in utilizing the assets that are available.Multiple choice question.activity ratiosliquidity ratiosdebt ratiosleverage ratios
Solution
The correct answer is "activity ratios". Activity ratios measure the effectiveness of a company's management in using its assets to generate income or profits. These ratios include inventory turnover, accounts receivable turnover, and total asset turnover, among others. They are used to evaluate how efficiently a company is utilizing its assets.
Similar Questions
Since converting the firm's inventory to profits is a key function of management, firms use ______ to measure the effectiveness of management in utilizing the assets that are available.Multiple choice question.leverage ratiosdebt ratiosactivity ratiosliquidity ratios
Multiple Choice QuestionWhat type of ratios measure how effectively a firm is using its various resources to achieve profits?Multiple choice question.ProfitabilityLiquidityLeverageActivity
Multiple Choice Question______ ratios measure how much operating income an organization is able to generate relative to assets, owners' equity, and sales.Multiple choice question.ProfitabilityAsset utilizationLiquidityDebt utilization
Multiple Choice QuestionA manufacturing business must take resources and transform them into goods and services. The development and administration of the activities involved in this process is referred to as ______.Multiple choice question.inventory managementoperations managementmarketing managementsupply chain management
The ratios that measure the effectiveness of a firm's management in turning over inventory are called ______.Multiple choice question.liquidity ratiosactivity ratiosleverage ratiosquick ratios
Upgrade your grade with Knowee
Get personalized homework help. Review tough concepts in more detail, or go deeper into your topic by exploring other relevant questions.