Which of the following is a profitability ratio? MCQ with Answer and Explanation

Which of the following is a profitability ratio?
A. Quick Ratio
B. Current Ratio
C. Return on Investment (ROI)
D. Debt-Equity Ratio
Answer: Option C
Solution (By JKSSB Mock Tests)
Return on Investment (ROI) measures the profitability of the capital employed in the business.

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Practice More Accountancy and Book Keeping Questions

Question #1
Which of the following would cause a difference in Cash Book and Pass Book?
A. Interest credited by bank
B. Bank charges debited by bank
C. Direct deposit by a customer into bank
D. All of the above

Correct Answer: Option D


Explanation:
All these items may be recorded by bank but not yet by customer, causing timing differences.

Question #2
The 'Revised Return' under Income Tax can be filed:
A. Any time
B. Within one year
C. Only once
D. Before the end of the assessment year or completion of assessment, whichever is earlier

Correct Answer: Option D


Explanation:
Revised return can be filed up to 3 months before the end of relevant assessment year or before completion of assessment, whichever is earlier.

Question #3
To ascertain profit under the Single Entry System (Statement of Affairs method), closing capital is compared with:
A. Total Assets
B. Total Liabilities
C. Cash Balance
D. Opening Capital

Correct Answer: Option D


Explanation:
Profit or loss is determined by comparing the capital at the end of the year with the capital at the beginning, adjusted for drawings and fresh capital.