Activity Ratios: Definition, Formula & Analysis


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When are fixed assets converted into cash?

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1. Which of the following is not an activity ratio?

2. Which ratio is not used to determine how efficient a business is at converting its current assets into cash?

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About This Quiz & Worksheet

You can easily gauge your knowledge of what activity ratios are and their calculations by using this quiz and worksheet assessment tool. To do well on this quiz, you must be able to identify activity ratios and what they are used to calculate.

Quiz & Worksheet Goals

Use this quiz to quickly determine your ability to:

  • State when fixed assets are converted into cash
  • List examples of activity ratios
  • Identify activity ratios used to determine the efficiency of a business to convert current assets into cash
  • Recognize which activity ratio the inventory turnover ratio calculates
  • Name the activity ratio that uses accounts receivable on its calculation

Skills Practiced

  • Reading comprehension - ensure that you draw the most important information from the lesson, such as what represents activity ratios
  • Information recall - access the knowledge you've gained regarding the inventory turnover ratio
  • Knowledge application - use your knowledge to answer questions about the conversion of fixed assets into cash and an activity ratio that uses accounts receivable for its calculation

Additional Learning

You can expand your knowledge of this topic by reviewing the lesson titled Activity Ratios: Definition, Formula & Analysis. You can gain more insight into:

  • How activity ratios are defined
  • How assets are classified and what exemplifies each classification
  • What information is gleaned from the fixed asset turnover ratio