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Question
Match List I (Accounting Ratios) with List II (Formulae) and select the correct answer using the codes given below the lists:
| List I | List II | ||
| A. | Current Ratio | 1. | `"Credit Revenue from Operations"/"Average Trade Receivables"` |
| B. | Return on Investment | 2. | `"Profit before Interest and Taх"/"Interest on Long- term Debt"` |
| C. | Interest Coverage Ratio | 3. | `"Net Profit before Interest, Tax and Dividend"/"Capital Employed"` |
| D. | Trade Receivables Turnover Ratio | 4. | `"Current Assets"/"Current Liabilities"` |
Options
A - 1, B - 3, C - 2, D - 4.
A - 4, B - 2, C - 3, D - 1.
A - 4, B - 3, C - 2, D - 1.
A - 3, B - 2, C - 1, D - 4.
MCQ
Match the Columns
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Solution
A - 4, B - 3, C - 2, D - 1.
Explanation:
| List I | List II | ||
| A. | Current Ratio | 4. | `"Current Assets"/"Current Liabilities"` |
| B. | Return on Investment | 3. | `"Net Profit before Interest, Tax and Dividend"/"Capital Employed"` |
| C. | Interest Coverage Ratio | 2. | `"Profit before Interest and Taх"/"Interest on Long- term Debt"` |
| D. | Trade Receivables Turnover Ratio | 1. | `"Credit Revenue from Operations"/"Average Trade Receivables"` |
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