WorksheetsCurrent Ratios
Total questions: 19
Worksheet time: 28mins
Prepare of cash flow statement
Mandatory
Recommendatory
Required under the companies act
None of these.
Solvency ratio indicate ___________________
Profitability
Activity
Credit worthyness
None of these
Current ratio indicates
Ability to meet short term obligations
Efficiency of Management
Profitability
None of these.
The liquid ratio should be around
4
2
5
1
Cash flows include
Cash receipts only
Cash payments only
Cash receipts and payment
Cash and non-cash incomes and expenses.
Short term investment is
A current asset
A current liability
An application of funds
All of these
Bank =1000, Cash =1000 and Inventory = 2000, accounts payable = 1500 what is the value of working capital?
2500
4000
1500
4500
Working capital is calculated by
Total Current Assets - Total expenses
Total liabilities + total assets
Total current assets-total current liabilities
Assets+capital
The two basic measures of liquidity are:
net capital ratio and current ratio
current ratio and quick ratio
working capital ratio and equity/asset ratio
current ratio and debt structure ratio
The _________ is a measure of liquidity which excludes _______, generally the least liquid asset:
Current ratio, account receivable
Liquid ratio, account receivable
Current ratio, inventory
Quick ratio, inventory
A Business Has The Following:
Machinery = RM16000
Acc receivable = RM2000
Inventory = RM5000
Cash = RM10000
Breeding livestock = RM10000
Current Liabilities = RM11000
Calculate It's Current Ratio
3.9
2.5
1.5
12.4
A Business Has The Following:
Fixed Assets = RM6000
Cash = RM2000
Marketable securities = RM5000
Inventory = RM1000
Acc receivable = RM4000
Current Liabilities = RM5000
Calculate It's Quick Ratio
1.2
2.2
2.4
3.6
If current liabilities are RM100,000 and current assets are RM200,000, what is the current ratio?
0.50
1.20
1.50
2.00
NOT IN THE CHOICES
Which is not a quick asset?
Cash equivalents
Notes receivable
Inventories
Cash substitutes
NOT IN THE CHOICES
Identify two liquidity ratios.
Current Ratio
Fixed Asset Turnover
Quick Ratio
Debt to Equity
If an SME's quick ratio is significantly lower than its current ratio, what might be a potential concern?
Efficient inventory management
High liquidity risk
Strong solvency position
Effective receivables management
What does an increase in the current ratio indicate about a company's short-term financial position?
Improved liquidity
Higher profitability
Increased leverage
Declining solvency
