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Introduction: The
The solvency ratios suggest the long-term solvency position of the business taking into consideration the capital structure in which the finances have been employed. The same is determined through the debt-equity ratio and times interest earned.
The profitability ratios suggest the earning capacity of the business in terms of profit margin based on sales revenue and return on total assets based on total assets of the business.
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Ratios required to measure the operating efficiency.
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Introduction: The liquidity ratios of the business are computed to know the short-term liquidity position of the business to know the capacity of paying the short-term liabilities. The same is computed and determined through the Current ratio and Acid-Test ratio.
The solvency ratios suggest the long-term solvency position of the business taking into consideration the capital structure in which the finances have been employed. The same is determined through the debt-equity ratio and times interest earned.
The profitability ratios suggest the earning capacity of the business in terms of profit margin based on sales revenue and return on total assets based on total assets of the business.
The term used for the difference in current assets and current liabilities.
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Introduction: The liquidity ratios of the business are computed to know the short-term liquidity position of the business to know the capacity of paying the short-term liabilities. The same is computed and determined through the Current ratio and Acid-Test ratio.
The solvency ratios suggest the long-term solvency position of the business taking into consideration the capital structure in which the finances have been employed. The same is determined through the debt-equity ratio and times interest earned.
The profitability ratios suggest the earning capacity of the business in terms of profit margin based on sales revenue and return on total assets based on total assets of the business.
The ratios required for knowing the frequency of collection of accounts.
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Chapter 13 Solutions
FINANCIAL ACCT.FUND.(LOOSELEAF)
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Cornerstones of Financial AccountingAccountingISBN:9781337690881Author:Jay Rich, Jeff JonesPublisher:Cengage Learning