Question : Which of the following statements is false with respect to the Activity ratio?

Option 1: These ratios are known as turnover ratios.

Option 2: These ratios measure the efficiency and rapidity of the resources of the Company.

Option 3: These ratios are generally calculated on the basis of revenue from operations or cost of revenue from operations. 

Option 4: None of the above

Question : Assertion (A): Activity ratios are calculated for measuring the efficiency of operations of a business based on the effective utilization of resources.
Reason (R): The current ratio, Quick ratio, asset turnover ratio, inventory ratio, account receivables turnover, etc are included in the Activity ratios

Option 1: Both A and R are true and R is the correct explanation of A.
 

Option 2: Both A and R are true, but R is not the correct explanation of A.
 

Option 3: A is true, but R is false.
 

Option 4: A is false, but R is true.

Question : Which of the following statements are false with respect of Net profit ratio?

Option 1: Net Profit Ratio establishes the relationship between Net Profit and Revenue from Operations, i.e., Net Sales.

Option 2: Net Profit Ratio is an indicator of overall efficiency of the business. Higher the Net Profit Ratio, better the business.

Option 3: An increase in the ratio over the previous period shows improvement in the operational efficiency and decline means otherwise.

Option 4: None of the above.

Question : Which of the following statements are false with respect of Net profit ratio?

Option 1: Net Profit Ratio establishes the relationship between Net Profit and Revenue from Operations, i.e., Net Sales.

Option 2: Net Profit Ratio is an indicator of overall efficiency of the business. Higher the Net Profit Ratio, better the business.

Option 3: An increase in the ratio over the previous period shows improvement in the operational efficiency and decline means otherwise.

Option 4: None of the above.

Question : Read the following statements: Assertion (A) and Reason (R). Choose one of the correct alternatives given below:

Assertion (A): Activity Ratios are the ratios that are calculated for measuring the efficiency of operations of business based on effective utilisation of resources.

Reason (R): Current ratio and Quick Ratio are liquidity ratios.

Option 1: Both Assertion (A) and Reason (R) are true and Reason (R) is the correct explanation of Assertion (A).

Option 2: Both Assertion (A) and Reason (R) are true and Reason (R) is not the correct explanation of Assertion (A).

Option 3: Assertion (A) is true but Reason (R) is False

Option 4: Assertion (A) is false but Reason (R) is true