Multiple choice

1) Which of the following is not a primary source of capital to the firm? 

A.-common stock

B.-preferred stock

C.-assets

D.-bonds

2) Which account represents the cumulative earnings of the firm since its formation, minus dividends paid? 

A.-Common stock

B.-Accumulated depreciation

C.-Paid-in capital

D.-Retained earnings

3) The most rigorous test of a firm's ability to pay its short-term obligations is its 

A.-quick ratio.

B.-times-interest-earned ratio.

C.-current ratio.

D.-debt-to-assets ratio.

4) In examining the liquidity ratios, the primary emphasis is the firm's 

A.-overall debt position.

B.-ability to earn an adequate return.

C.-ability to effectively employ its resources.

D.-ability to pay short-term obligations on time.