MANAGEMENT

BUISENESS MANAGEMENT

FINANCIAL MANAGEMENT

Question [CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
The company’s liabilities divided by the owners’ equity is the current ratio.
A
True
B
False
C
Either A or B
D
None of the above
Explanation: 

Detailed explanation-1: -Which of the following statements is true regarding the current ratio?-The current ratio is calculated as current assets divided by current liabilities.

Detailed explanation-2: -Answer and Explanation: The answer is D. Ratios help analyze the performance of a company and compare its performance with other firms within that industry.

Detailed explanation-3: -Answer and Explanation: A) It shows a company’s stock issuances and dividends paid to shareholders is true of the statement of stockholders’ equity.

Detailed explanation-4: -Equity is considered a type of liability, as it represents funds owed by the business to the shareholders/owners. On the balance sheet, Equity = Total Assets – Total Liabilities. The two most important equity items are: Paid-in capital: the dollar amount shareholders/owners paid when the stock was first offered.

There is 1 question to complete.