Which of the following best describes profitability?
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C. The ability of a business to generate profit relative to its size or investment This is the correct answer because profitability measures how well a business generates profit relative to its size or investment. The other options describe liquidity (A), revenue generation (B), and cash flow management (D).
Which of the following is a measure of liquidity?
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C. Current ratio This is the correct answer because the current ratio measures a business's ability to pay its short-term obligations with its short-term assets. The other options are measures of profitability.
Which of the following is NOT a profitability ratio?
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D. Acid test ratio This is the correct answer because the acid test ratio is a measure of liquidity, not profitability. The other options are all measures of profitability.
Which of the following is a liquidity ratio?
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C. Current ratio This is the correct answer because the current ratio measures a business's ability to pay its short-term obligations with its short-term assets. The other options are measures of profitability.
Which of the following is a measure of profitability?
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A. Gross profit margin This is the correct answer because gross profit margin measures the profitability of a business's core operations. The other options are measures of liquidity.
Which of the following is a measure of liquidity?
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C. Current ratio This is the correct answer because the current ratio measures a business's ability to pay its short-term obligations with its short-term assets. The other options are measures of profitability.
Which of the following is a measure of profitability?
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A. Gross profit margin This is the correct answer because gross profit margin measures the profitability of a business's core operations. The other options are measures of liquidity.
Which of the following is a measure of liquidity?
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C. Current ratio This is the correct answer because the current ratio measures a business's ability to pay its short-term obligations with its short-term assets. The other options are measures of profitability.
Which of the following is a measure of profitability?
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A. Gross profit margin This is the correct answer because gross profit margin measures the profitability of a business's core operations. The other options are measures of liquidity.
Which of the following is a measure of liquidity?
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C. Current ratio This is the correct answer because the current ratio measures a business's ability to pay its short-term obligations with its short-term assets. The other options are measures of profitability.
Which of the following is a measure of profitability?
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A. Gross profit margin This is the correct answer because gross profit margin measures the profitability of a business's core operations. The other options are measures of liquidity.
Which of the following is a measure of liquidity?
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C. Current ratio This is the correct answer because the current ratio measures a business's ability to pay its short-term obligations with its short-term assets. The other options are measures of profitability.
Which of the following is a measure of profitability?
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A. Gross profit margin This is the correct answer because gross profit margin measures the profitability of a business's core operations. The other options are measures of liquidity.
Which of the following is a measure of liquidity?
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C. Current ratio This is the correct answer because the current ratio measures a business's ability to pay its short-term obligations with its short-term assets. The other options are measures of profitability.
Which of the following is a measure of profitability?
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A. Gross profit margin This is the correct answer because gross profit margin measures the profitability of a business's core operations. The other options are measures of liquidity.