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Activity Ratios: Definition, Formula & Analysis

Instructions:

Choose an answer and hit 'next'. You will receive your score and answers at the end.

question 1 of 3

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

Activity ratios are a set of tools that help businesses understand how well they can convert their assets to cash. This quiz and worksheet combo will ensure you understand what these tools are and how they can be used.

Quiz & Worksheet Goals

This quiz and worksheet will assess your knowledge of the following:

  • When fixed assets are converted to cash
  • Identifying activity ratios
  • Knowing what ratio serves what purpose

Skills Practiced

These assessment tools will ensure you can use the following skills:

  • Reading comprehension - ensure that you draw the most important information from the related lesson on activity ratios
  • Knowledge application - use your knowledge to answer questions about converting assets to cash
  • Information recall - access the knowledge you've gained regarding inventory turnover ratio

Additional Learning

Check your understanding of activity ratios by reviewing the lesson called Activity Ratios: Definition, Formula & Analysis. This lesson will cover the following objectives:

  • Discussing what activity ratios are and what they can do for a business
  • Defining key terms, such as asset and inventory turnover
  • Providing formulas for using activity ratios
  • Describing the tools that make up activity ratios
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