Matching Match each ratio to its use. Items may be used more than once. a To ass
ID: 2588521 • Letter: M
Question
Matching Match each ratio to its use. Items may be used more than once. a To assess the profiability of the assets h. To assess the effectiveness in the use of assets c. To indicate the abiliry to meer currewly marwring oligations d To indicate the margin of safety to creditors e. To Indicate instant debt payi ability To assess the profitability of the invesment by common stockholders e To indicate fwure earnings pwaspects h. To indicare the extent to which earnings are being distributed 10 common stockholders 36. Price-Earnings(P/E) Raio 37. Working Capital 38. Rate Eamed on Total Assets 39, Ratio of Liabilities to Stockholders' Equity 40. Quick Ratio 41. Rate Earned on Common Stockholders' Equity 42. Current Ratio 43. Ratio of Net Sales to Assets 44. Dividends per Share 45. Eamings per Share (EPS) on Common Stock Identify the costs as one of the following: a Direct labar b Direct materials c. Factory overhead d Not a provct cos 46. Factory depreciation 47. President's salary 48. Salesmen commissions 49. Wood 50. Factory supervisor's salaryExplanation / Answer
Ratio ratio used for the purpose of 36 price earning rato (P/E ratio) (g ) To indicate future earnings prospects 37 Working capital (c )To indicate the ability to meet currently maturing obligations 38 rate earned on taotal assets (a) To assess the proFtability of the assets 39 ratio of Liabilities to share holders equity (d) To indicate the margin of safety to creditors 40 Quick ratio (e ) To indicate instant debt- paying ability 41 Rate earned on common stock holders equity (f) To assess the proFtability of the investment by common stockholders 42 current ratio (c )To indicate the ability to meet currently maturing obligations 43 ratio of net sales to assets (b) To assess the efectiveness in the use of assets 44 Dividend per share (h) To indicate the extent to which earnings are being distributed to common stockholders 45 Earnings per share of common stock (f) To assess the proFtability of the investment by common stockholders Identifying the cost as direct labour , Direct materials -factory over head cost - not a product cost particulrr cost identfation 46 factory depreciation factory overhead 47 president Salary Not a product cost 48 sales man Commission Not a product cost 49 Wood Direct materials 50 factory superwisory salalry factoy over ehad