Financial Ratios Quiz

Current Ratio: Calculate the ratio of current assets to current liabilities to understand the company's short-term liquidity.

Quick Ratio: Determine the ratio that assesses the company's ability to meet short-term obligations without relying on inventory.

Gross Profit Margin: Find the percentage of sales that results in gross profit, indicating the profitability of core operations.

Operating Profit Margin: Calculate the percentage of sales that results in operating income.

Net Profit Margin: Identify the percentage of sales that translates into net income after all expenses.

Debt-to-Equity Ratio: Determine the ratio of total liabilities to total equity, assessing the company's financial leverage.

Equity Ratio: Calculate the ratio that shows what percentage of assets is financed by equity.

Interest Coverage Ratio: Assess the company's ability to pay interest from operating income.

Inventory Turnover Ratio: Calculate how often inventory is sold and replaced during the year.

Receivables Turnover Ratio: Find the ratio that indicates how quickly the company collects accounts receivable.