Question : Assertion (A): Activity ratios are calculated for measuring the efficiency of operations of a business based on the effective utilization of resources. Reason (R): The current ratio, Quick ratio, asset turnover ratio, inventory ratio, account receivables turnover, etc are included in the Activity ratios
Option 1: Both A and R are true and R is the correct explanation of A.
Option 2: Both A and R are true, but R is not the correct explanation of A.
Option 3: A is true, but R is false.
Option 4: A is false, but R is true.
Correct Answer: Both A and R are true and R is the correct explanation of A.
Solution : A financial indicator called an activity ratio shows how effectively a company is using the assets on its balance sheet to produce revenue and cash. The quick ratio, inventory ratio, account receivables turnover, and current ratio are examples of activity ratios. Hence option 1 is the correct answer.
Question : Read the following statements: Assertion (A) and Reason (R). Choose one of the correct alternatives given below:
Assertion (A): Activity Ratios are the ratios that are calculated for measuring the efficiency of operations of business
Question : Assertion: Factors affecting physical distribution include transportation, warehousing, and inventory management.
Reason: Physical distribution has no role in improving supply chain efficiency and customer satisfaction.
Question : Which of the following statements is false with respect to the Activity ratio?
Regular exam updates, QnA, Predictors, College Applications & E-books now on your Mobile