1. What is the difference between the acid test ratio and current ratio?
- Acid test excludes inventories
- Acid test includes inventories
- Current ratio excludes inventories
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Other questions in this quiz
2. A benefit of critical path analysis is that
- it can beused to calculate the impact of delays to the completion of a project
- it allows a firm to complete a project quickly
- it measures the risks of a decision
- it automatically increases a business's profits
3. What is gearing?
- Preparing to enter a new market
- The amount of a firm's capital that is funded by loans as opposed to share capital
- The amount of a firm's capital that is funded by share capital as opposed to loans
- Total equity + non current liabilities / cash flow x 100
4. What is working capital?
- money used to purchase capital equipment
- current assets / current liabilities
- The capital a firm possesses to fund its day-to-day operations
- the money a firm possesses to pay back its long-term debts
5. What is the formula for average rate of return (ARR)?
- Profit for the year / total equity x 100
- net cash flow / the number of years / initial cost of investment x 100
- net cash flow / the number of years x initial cost of investment
- Profit / the number of years x 100