1
Q
Current ratio
A
current assets / current liabilities
2
Q
Acid test ratio
A
current assets - inventory / current liabilities
3
Q
gearing ratio
A
non current liabilities / capital employed
x100
4
Q
ROCE
A
operating profit / capital employed
x100
5
Q
optimal current ratio
A
2:1 , 1.5:1
6
Q
optimal ratio of acid test
A
1:1 , 1.5:1
7
Q
what gearing ratio is good for investors
A
below 50%
8
Q
what rate is better for ROCE
A
higher
9
Q
labour productivity
A
total output / number of workers
10
Q
labour turnover
A
number of employees leaving / average number of employees
x100
11
Q
absenteeism
A
number of work days lost through absence / total possible days worked
x100
12
Q
how to work out average rate of return
A
- add up all cash inflows
- minus the original cost of the project
- divide by number of years project is run for
- divide that figure by cost of project X100
13
Q
capital employed
A
total equity + non current libilities
Business
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Decks in class (11)
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