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CPCU 540/Formulas & Ratios Questions And Answers With Verified Solutions Already Passed!!!
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CPCU 540/Formulas & Ratios Questions And Answers With Verified Solutions Already Passed!!!
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CPCU 540/Formulas & Ratios QuestionsAnd Answers With Verified Solutions
Already Passed!!!
Account Receivable Turnover - ANSWER✔✔ Credit Sales / Accounts Receivable
EFFICIENCY
Asset Turnover - ANSWER✔✔ Sales / Total Assets
EFFICIENCY
Inventory Turnover - ANSWER✔✔ Cost of Goods Sold / Inventory
EFFICIENCY
Current Ratio - ANSWER✔✔ Current Assets / Current Liabilities
LIQUIDITY
Ability to meet current liabilities w/ assets
Acid Test (Quick Ratio) - ANSWER✔✔ (Current Asset - Inventory) / Current
Liabilities
, LIQUIDITY
Ability to pay liabilities w/ cash & liquid assets
Debt to Equity - ANSWER✔✔ Long term debt / SH Equity
LEVERAGE
Measure debt vs own funds
Debt to Asset - ANSWER✔✔ Total Debt / Total Asset
LEVERAGE
Less than 1 = Co finances most assets thru Sh's
Measures % of assets financed by debt
Net Profit Margin - ANSWER✔✔ Net Proft / Revenue
Net Income - ANSWER✔✔ Total Revenue - Total Expenses
Return on Assets - ANSWER✔✔ Net income / Total Assets
How profitable a co is compared to investment in assets
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