Which ratios are specifically concerned with assessing the efficiency with which assets have been used by the business?
A)Liquidity ratios
B)Efficiency ratios
C)Gearing ratios
D)Investment ratios

Question

Quizplus · Accepted Answer

Efficiency ratios, also known as activity ratios or turnover ratios, are specifically concerned with assessing the efficiency with which assets have been used by the business. These ratios include inventory turnover ratio, accounts receivable turnover ratio, and fixed asset turnover ratio, among others. Liquidity ratios assess a company's ability to meet short-term obligations, gearing ratios measure the proportion of debt and equity in a company's capital structure, while investment ratios assess the returns and risks associated with investing in a company's stock.

Which Ratios Are Specifically Concerned with Assessing the Efficiency with Which