In ratio analysis, 'Stock Turnover Ratio' indicates: MCQ with Answer and Explanation

In ratio analysis, 'Stock Turnover Ratio' indicates:
A. Debt repayment capacity
B. How quickly inventory is sold
C. Fixed asset efficiency
D. The number of employees
Answer: Option B
Solution (By JKSSB Mock Tests)
Stock turnover = Cost of goods sold / Average stock, measuring inventory management efficiency.

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Practice More Accountancy and Book Keeping Questions

Question #1
Under the Companies Act 2013, the 'Independent Directors' must hold a special training as per Section 149. Who is exempted from this training requirement?
A. A person who has been a director for more than 10 years
B. A person who has already undergone the training or is a whole-time director in a listed company
C. A qualified Chartered Accountant or Company Secretary
D. No one is exempted

Correct Answer: Option B


Explanation:
The Companies Act exempts individuals who have already undergone the prescribed independent director training, or those who are already serving as whole-time directors in listed companies, from the mandatory training requirement.

Question #2
A tax levied on a person based on their net wealth was the Wealth Tax. In India, Wealth Tax was abolished in:
A. 2017
B. 2015
C. 1991
D. 2005

Correct Answer: Option B


Explanation:
Wealth tax was abolished in the Union Budget of 2015-16, replaced by an additional surcharge on the super-rich.

Question #3
Fair Value Accounting requires assets and liabilities to be measured at:
A. Book Value
B. Written Down Value
C. Current market price or estimated exit price
D. Historical Cost

Correct Answer: Option C


Explanation:
Under Fair Value, items are reported based on current market valuations, replacing the traditional historical cost concept for many financial instruments.