Activity 10 TEST YOUR UNDERSTANDING A Review of Rata Analysis ORACLE CORPORATION endar 1.79 (P/L/S) En the fiscal Current ratio 1299 1.74 1.70 (PLUS) Det to 0.491 0.492 0.488 (P/L/S) Reum on sales 0.15 0.11 0.14 (PL/S) Return on assets 0.18 0.14 0.18 Sour cure, he, Compact SEC. 2000 1. In the left-hand margin above, circle whether the ratio measures (Profitability, short-term (Liquidity - the ability to pay current debt, or long-term (Solvency - the ability to pay long-term det 2. For och short-term liquidity ratio above, circle the ratio indicating the greatest ability to pay cute liabilities for the three years of information presented 3. This company appears to have not have the ability to pay current debt. For each long-term solvency ratio sbove, circle the ratio indicating the least amount of debt financing for the three years of information presented 4. This company relies more heavily on (debt/equity) to finance assets. For each profitability ratio above, circle the ratio indicating the greatest profitability over the three years of information presented. The profitability of this company appears to be strong / weak). 5. Refer to all of the ratio information presented above. This company appears to be strong / weak). Explain your answer. 6. The ratio that measures the proportion of total assets finanood with liabilities is (Return on sales/Return on assets / Current ratio / Debt ratio). 7. The ratio that measures the proportion of net sales resulting in profits is (Return on sales / Return on assets / Current ratio / Debt ratio). 8. The ratio that measures how effectively assets are used to generate profits is (Return on sales/ Return on assets / Current ratio/Debt ratio). 9. A supplier extending credit to a company for 60 days would be most interested in examining the (Return on sales / Return on assets / Current ratio / Debt ratio). Introduction Page 12