Free Financial Management For Project Managers Financial Ratio Questions and Answers

Question 1

What contains the net profit ratio calculation formulas?

Accepted Answer

(Net Profit/Net sales)*100

Answer

none of these

Answer

(Gross Profit/Net sales)*100

Answer

(Gross Profit/Gross sales)*100

Question 2

How much of a contribution margin will bundle it have? The bundle's contribution margin is Rs. 40,000, while its income is Rs. 15,000

Accepted Answer

0.03

Answer

0.12

Answer

0.09

Answer

0.06

Question 3

Which ratio is regarded as a safe selvency margin?

Accepted Answer

Current ratio

Answer

none of these

Answer

Quick ratio

Answer

Liquid ratio

Question 4

How much will the fross profit ratio be? If the sale price is set at a 25% premium to the cost

Accepted Answer

0.2

Answer

0.26

Answer

0.28

Answer

0.13

Question 5

What is determined when gross margin is proportional to revenues?

Accepted Answer

gross margin percentage

Answer

sales margin percentage

Answer

cost margin percentage

Answer

income margin percentage

Question 6

When the opening stock is Rs. 31,000, what would the stock turnover rate be? the closing stock price is Rs. Sales are Rs. 320000, and the gross profit margin is 25%.

Accepted Answer

8 times

Answer

32 times

Answer

11 times

Answer

31 times

Question 7

What might be violated if a business's asset turnover ratio is lower than the industry average?

Accepted Answer

the company is utilizing assets less effeciently than other firms in the industry.

Answer

the company is less profitable than other firms in the industry.

Answer

the company is less likely to avoid insolvency in the short run than other firms in the industry.

Answer

the company has a lower P/E ratio than others firms in the industry.

Question 8

How are liquidity ratios expressed?

Accepted Answer

Pure ratio form

Answer

none of these

Answer

Rate or time

Answer

Percentage

Question 9

What conclusions can be drawn from a company's market to book value ratio being the same as the industry average and its ROE being lower than the industry average?

Accepted Answer

the company has a higher P/E ratio than other firms in the industry

Answer

the company is utilizing its assets more effciently than other firms in the industry

Answer

the company is more profitable than other firms in the industry

Answer

the company is more like to avoid insolvency in the short run that other firms in the industry

Question 10

What is determined when operating income is divided by contribution margin?

Accepted Answer

degree of operating leverage

Answer

degree of change in income

Answer

degree of change in margin

Answer

degree of change