Name: 
 

Chapter 8 - The Interpretation of Accounting Statements


Multiple Choice
Identify the letter of the choice that best completes the statement or answers the question.
 

 1. 
The return on equity is:
a.
31.3%
c.
50.3%
b.
44.2%
d.
74.8%
 

 2. 
The return on capital employed is:
a.
19.4%
c.
31.2%
b.
46.4%
d.
27.4%
 

 3. 
The gross margin is:
a.
26.8%
c.
15.8%
b.
36.6%
d.
11.2%
 

 4. 
The net profit to sales is:
a.
11.2%
c.
26.8%
b.
15.8%
d.
36.6%
 

 5. 
The asset turnover is:
a.
0.36
c.
2.50
b.
1.73
d.
2.79
 

 6. 
The current ratio is:
a.
0.55
c.
1.12
b.
0.90
d.
1.83
 

 7. 
The quick ratio is:
a.
1.12
c.
0.89
b.
1.83
d.
0.70
 

 8. 
The stock turnover is:
a.
0.15
c.
4.83
b.
0.21
d.
6.59
 

 9. 
The debtor turnover is:
a.
0.17
c.
4.38
b.
1.61
d.
5.99
 

 10. 
The creditor turnover is:
a.
7.09
c.
3.40
b.
9.68
d.
4.64
 

 11. 
The interest cover is:
a.
5.1
c.
8.2
b.
7.2
d.
12.2
 

 12. 
The balance sheet gearing is:
a.
61.3%
c.
62.0%
b.
38.0%
d.
263.0%
 



 
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