Question : ---------------------ratios measure how well the facilities at the disposal of the concern are being utilized.
Option 1: Solvency ratio
Option 2: Liquidity ratio
Option 3: Activity ratio
Option 4: Profitability ratio
Answer (1)
19th Jan, 2024
Correct Answer: Activity ratio
Solution : Answer = Activity ratio
Activity Ratio measures how well the facilities at the disposal of the concern are being utilised. These Ratios are Known as the
Turnover Ratio
. It assesses the efficiency of utilising resources by measuring turnover, such as inventory, assets, and accounts receivable, to evaluate how effectively a company's assets are being employed to generate revenue.
Hence, the correct option is 3.
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