Exam 2 | Questions and Answers | 2025 Update | 100% Correct-GT

MGT 8803 Exam 2 | Questions and Answers | 2025
Update | 100% Correct-GT.

Accounting Equation - ANSW -Assets = Liabilities + Owner's Equity
m m m m m m m m m m




(Resources = Creditors' claims) m m m




Acid-Test Ratio m m




(AKA Quick Ratio) - ANSW -Cash + Marketable Securities + Receivables /
m m m m m m m m m m m




Total Current Liabilities
m m




Liquidity Ratio m




Want: More than 1
m m m




Like more conservative current ratio (minus inventory)
m m m m m m




Asset Quality Ratio - ANSW -Ratios related to turnover and inventory
m m m m m m m m m m




Asset Turnover Ratio - ANSW -Sales /
m m m m m m m




Average Total Assetsm m




Asset Quality Ratio
m m




Want: The higher the better
m m m m m




Note: Measures how efficiently a company's assets are used to generate sales
m m m m m m m m m m m




Assets - ANSW -Resources or rights to receive resources.
m m m m m m m m




Types are physical, intangible, and legal (right to receive).
m m m m m m m m




Average Inventory - ANSW -(Beginning Inventory + Ending Inventory) /
m m m m m m m m m m




2

Balance Sheet - ANSW -Measures financial position at a point in time. Includes assets, liabilities,
m m m m m m m m m m m m m m


mand owner's equity - what company has and what it owes.
m m m m m m m m m m