4. Leverage ratios measure:

Group of answer choices

A. The ability of a business to repay its debt

B. A businesss profitability from operations

C. The speed at which product sales are being converted to cash

D. The ability of a business to pay their bills over the next year

5. The formula for the debt to equity ratio is:

Group of answer choices

A. Total liabilities divided by shareholders equity

B. Current liabilities divided by current assets

C. Long-term liabilities divided by owners equity

D. Total liabilities divided by total assets

6. Current assets are $52,500. Inventory is $11,500. Current liabilities are $37,250. Calculate the current ratio.

Group of answer choices

A. 0.71

B. 1.41

C. 1.10

D. 0.91

7. An operational-centric business can most easily be differentiated from a customer-centric business by reviewing:

Group of answer choices

A. Working capital

B. Net margin

C. Gross margin

D. Operation profits

8. Which of the following companies is likely to have the lowest collection period?

Group of answer choices

A. Overstock.com (internet retailer)

B. Pacific Power and Light (electric utility)

C. United Technologies (diversified manufacturer)

D. PricewaterhouseCoopers (Big 4 accounting firm)