Match List-I with List-II, List-I (Accounting Ratio), List-II (Objectives/ Use of Accounting Ratio), (A) Liquidity Ratio, (I) To know the earning capacity of the business, (B) Profitability Ratio, (II) To know the ability to pay long-term obligations, (C) Solvency Ratio, (III) To know the efficiency of business operations, (D) Activity Ratio, (IV) To know the ability to pay short-term obligations, Choose the correct answer from the options given below:

Question

Match List-I with List-II | List-I (Accounting Ratio) | List-II (Objectives/ Use of Accounting Ratio) | |---|---| | (A) Liquidity Ratio | (I) To know the earning capacity of the business | | (B) Profitability Ratio | (II) To know the ability to pay long-term obligations | | (C) Solvency Ratio | (III) To know the efficiency of business operations | | (D) Activity Ratio | (IV) To know the ability to pay short-term obligations | Choose the correct answer from the options given below:

Accepted Answer

(A) - (IV), (B) - (I), (C) - (II), (D) - (III)

Answer

(A) - (II), (B) - (I), (C) - (III), (D) - (IV)

Answer

(A) - (II), (B) - (III), (C) - (I), (D) - (IV)

Answer

(A) - (IV), (B) - (II), (C) - (III), (D) - (I)

List-I (Accounting Ratio)	List-II (Objectives/ Use of Accounting Ratio)
(A) Liquidity Ratio	(I) To know the earning capacity of the business
(B) Profitability Ratio	(II) To know the ability to pay long-term obligations
(C) Solvency Ratio	(III) To know the efficiency of business operations
(D) Activity Ratio	(IV) To know the ability to pay short-term obligations

Solution

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