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BOMI Budgeting & Actg Ch 8 Key Concepts exam questions and answers 2025.
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BOMI Budgeting & Actg Ch 8 Key Concepts exam questions and answers 2025.
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BOMI: Budgeting & Actg Ch 8Key Concepts exam questions
and answers 2025
What three common ratios are used to determine earning power? -
answer Earning per share, return on equity and common-size
comparative statements
Define earnings per share. - answer Data used to evaluate the past
performance of a business, project its future earnings, and weigh
investment opportunities.
What is liquidity? - answer Liquidity is the ability of a company to
meet its current obligations
The amount of a company's ______________ is not a measure of its
______________. - answer working capital; working capital position
Define current ration. - answer the relationship of a company's
current assets to its current liabilities.
What is an easily calculated check on current asset composition? -
answer The acid-test ratio
Define acid-test ratio. - answer The ratio of quick assets to current
liabilities. Also called a quick ratio.
What is inventory turnover? - answer The number of times average
inventory is sold during an accounting period.
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