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The Following Question Relates to PQR,which Has the Following Ratios

Question 43

Multiple Choice

The following question relates to PQR,which has the following ratios: return on assets, (ROA) 10 per cent;return on equity (ROE) 12 per cent;and current ratio (CR) of 1.8:1.
-A customer provides a deposit of $500 000 near year-end.The product will not be delivered until next year.This transaction will:


A) increase ROA and ROE,but decrease CR.
B) increase ROA and ROE,but have no effect on CR.
C) decrease CR,but have no effect on ROA or ROE.
D) decrease ROA and CR,but have no effect on ROE.

Correct Answer:

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