ACC419 Email: bbcnoun@gmail.com Whatsapp: 08131667008 Current assets used in the production process and held by the firm are called Answer: inventory The acid test ratio equals current assets minus divided by Answer: inventory; current liabilities Financial ratios can be classified into four major groups: Answer: liquidity, profitability, leverage and turnover Asset Turnover is measured by : Answer: sales/ capital employed Price earnings ratio is calculated as: Answer: stock price/eps Using the information above, calculate the price-earnings ratio. Answer: 10 times Operating cash flow ratio is measured by Answer: cash flow from operations/current liabilities Which of the following is not a profitability ratio? Answer: return on profit Working capital turnover is measured as: Answer: sales/average working capital Email: bbcnoun@gmail.com Whatsapp: 08131667008