WGU C201 Business Acumen Chapter
15 & 16: Accounting and Financial
Statements - Ratios
1. Acid Test (Quick) Ratio and Current Ratio - ANS-Liquidity Ratios
2. Cost of products offered / average stock - ANS-Inventory Turnover.
3. Equals the range of instances stock actions through a commercial enterprise.
4. Cost of Goods Sold $200,000
5. Average Inventory $20,000
6. 200000/20000 = 10
7. Compare these to enterprise averages for industry.
8. Credit sales / common accounts receivable - ANS-Receivables Turnover
9. Current belongings - minus inventory / present day liabilities - ANS-Acid Test (Quick)
Ratio
10. Current assets $250
11. Inventory $20
12. Current Liabilities $100
13. 250-20=230
14. 230/one hundred=2.2
15. $2.20 assets for each $1 in liabilities
16. Current property / current liabilities - ANS-Current Ratio
17. Debt Ratio and Long Term Debt to Equity - ANS-Leverage Ratios
18. Gross earnings / sales - ANS-Gross Profit Margin.
19. Equals firm's realized profit.
20. What's left over after our price of goods bought.
21. Gross Profit Margin, Net Profit Margin and Return on Equity - ANS-Profitability Ratios
22. Inventory Turnover, Receivables Turnover, and Total Asset Turnover - ANS-Activity
Ratios
23. Long-Term Debt / Owner's Equity - ANS-Long Term Debt to Equity
24. Net Income / average fairness - ANS-Return on Equity.
25. How a good deal do we earn with the money shareholders make investments.
26. Higher is higher.
27. Net earnings / sales - ANS-Net Profit Margin.
28. How much of each greenback earned is become earnings..
29. Very vital for traders.
30. Sales / Average Total Assets - ANS-Total Asset Turnover.
31. Equals how a good deal sales every dollar invested in property generates.
32. Total Liabilities / Total Assets - ANS-Debt Ratio
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