Which of the following statements is TRUE?
A) The current ratio is current assets divided by current liabilities.
B) Total asset turnover is net income divided by total assets.
C) The cash coverage ratio equals cash divided by current liabilities.
D) The quick ratio equals current assets - current liabilities divided by current liabilities.
Answer: A
Explanation: A) Total asset turnover equals SALES divided by total assets. The CASH RATIO equals cash divided by current liabilities. The quick ratio equals (current assets - INVENTORIES) divided by current liabilities.
You might also like to view...
The Affordable Care Act (ACA) sets a 60% minimum actuarial value for an eligible employer plan. All of the following statements are true except that
A. Actuarial value indicates what percentage of covered expense the health plan will pay. B. Employer contributions to health-savings accounts may decrease the minimum actuarial value. C. An employee would not pay more than 40% of the covered expenses excluding the premium contribution. D. The lowest tier of plan allowed by the ACA is bronze.
A sequence of activities defined by the project network logic is a(n):
A) Event. B) Path. C) Node. D) Route.