Multiple choice

1) Which of the following is not considered to be a profitability ratio? 

A.-times interest earned

B.-return on assets (investment)

C.-profit margin

D.-return on equity

2) In general, the larger the portion of a firm's sales that are on credit, the 

A.-higher will be the firm's need to borrow.

B.-more the firm can buy raw materials on credit.

C.-lower will be the firm's need to borrow.

D.-more rapidly credit sales will be paid off.

3) In financial statements, the number of units shown in cost of goods sold as compared to the number of the units actually produced 

A.-is lower.

B.-can be either higher or lower.

C.-is higher.

D.-is the same.

4) In order to estimate production requirements, we 

A.-add projected sales in units to desired ending inventory and subtract beginning inventory.

B.-add beginning inventory to desired ending inventory and subtract projected sales in units.

C.-add beginning inventory to projected sales in units and subtract desired ending inventory.

D.-add beginning inventory to desired ending inventory and divide by two.