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Civil Engineering Objective Questions { Engineering Economics }



43. Liquidity ratios are used :
A. to measure a firms ability to meet short-cut obligations.
B. to compare short term obligations to short-term resources available to meet these obligations.
C. to obtain much insight into the present cash solvency of the firm and the firm's ability to remain solvent in the event of adversity.
D. All of these

44. The ratio of current assests to current liabilities is known as
A. Liquidity ratio
B. Current ratio
C. Acid-Test (or Quick) ratio
D. Debts ratio

45. The more critical (or severe) test of the firm's liquidity can be judged by :
A. Liquidity ratio
B. Current ratio
C. Acid-Test (or Quick) ratio
D. Debts ratio

46. Current assests less inventories divided by current liabilities is known as
A. Liquidity ratio
B. Current ratio
C. Acid-Test (or Quick) ratio
D. Debts ratio

47. Which one of the following definitions, is correct ?
A. The ratio of total debt to share holder's equity is called 'debt ratio'.
B. The ratio debt-to-total assests is called Debt-to-total assest ratio.
C. The ratio of earnings before interest and taxes for a particular reporting period to the amount of interest charges for the period, is called interest coverage ratio.
D. All of these

48. Pick up the correct statement from the following :
A. The ratios which slow profitability in relation to sales and those which show profitability in relation to investment, are called profitability ratios.
B. The ratio of gross profit and net sales, is 'c'alled profitability in relation to sales ratio.
C. The ratio of net profit after taxes to total assests is known as profitability in relation to investment ratio
D. All of these

49. Pick up the correct statement regarding financial statement analysis from the following.
A. Final analysis always involves the use of various financial statement.
B. The balance sheet is the summary of assests, liabilities and owner's equity of business at a point in time.
C. The income statement is the summary of revenues and expenses of a firm over a particular period of time,
D. All the above

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