Which of the following is a ratio that measures the firm's internal performance with respect to key activities defined by management?
A) A liquidity ratio
B) An activity ratio
C) Return on assets
D) A current ratio
E) Profit margin on sales

Question

Quizplus · Accepted Answer

An activity ratio measures how efficiently a company manages its assets and liabilities within key internal activities such as inventory management, accounts receivable management, and accounts payable management. Examples of activity ratios include inventory turnover ratio, accounts receivable turnover ratio, and accounts payable turnover ratio.

Which of the Following Is a Ratio That Measures the Firm's