What is activity ratio, Managerial Accounting

Assignment Help:

What is Activity ratio

Funds are invested in several assets in business to make sales and earn profits. The efficiency with which assets are managed directly affects the volume of sales. The better the management of assets the larger is the amount of sales and profit. Activity ratios measure the efficiency or effectiveness with which a firm manages its resources or assets these ratio are called turnover ratios because they indicate the speed with which assets are converted or turned over into sales. It includes the following ratios.

1) Capital turnover ratio

2) Fixed assets turnover ratio

3) Working capital turnover ratio

4) Stock turnover ratio

5) Debtors turnover ratio (or receivables ratio)

6) Creditors turnover ratio(or payables turnover ratio)

 


Related Discussions:- What is activity ratio

Cross elasticity of demand, what is cross elasticity of demand? is it posit...

what is cross elasticity of demand? is it positive for substitute or compliments? show in a diagram relating to the demand for the coffee to the price of tea

Explain variable cost and fixed cost, Explain variable cost and fixed cost ...

Explain variable cost and fixed cost Variable costs: costs that vary almost in the direct proportion to the volume of production are known as variable costs. The examples of

Research and writing assignment, Write a response to your boss, the control...

Write a response to your boss, the controller. The response should be 2-5 pages in length (double-space). Your response to the controller should include, but not be limited to, t

Management accounting, Management Accounting An accounting discipline c...

Management Accounting An accounting discipline concerned with the use of financial information. It used to relevant information by managers and other decision makers inside a s

Financial manager''s role in inventory management, Financial manager's role...

Financial manager's role in inventory management The techniques of inventory management are very useful in determining the optimum level of inventory and finding answers to the

Transactions involves spot exchange, Identify whether each of the following...

Identify whether each of the following transactions involves spot exchange, contract, or vertical integration. For the last item if the contract length is optimal or suboptimal.

Continuous probability distribution, CONTINUOUS PROBABILITY DISTRIBUTION (U...

CONTINUOUS PROBABILITY DISTRIBUTION (USE OF NORMAL DISTRIBUTION) In reality the C-V-P variables might take any values in a continuous range. It could therefore be more appropriat

Management decision making, Decision-making is an integral part of all ...

Decision-making is an integral part of all management functions. It is the process of choosing the among alternative courses of action. Managers have to

The roles of management accounting within a company., Review the roles of m...

Review the roles of management accounting within a company. 1.What is the most important role of management accounting? 2.How is that different than financial accounting? 3.What is

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd