Match List – I with List – II.
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List – I |
List – II |
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(A) Current Ratio |
(I) How many times interest on long term debt |
|
(B) Turnover Ratio |
(II) Efficiency in utilization of resources |
|
(C) Debt equity Ratio |
(III) Long term solvency |
|
(D) Interest Coverage Ratio |
(IV) Liquidity position |
Choose the correct answer from the options given below:
Answer & explanation
Correct answer: option 3
The correct answer is Option (3) → (A)-(IV), (B)-(II), (C)-(III), (D)-(I)
(A) Current Ratio — this matches (IV) Liquidity position. It is a liquidity ratio showing ability to pay short-term dues.
(B) Turnover Ratio — this matches (II) Efficiency in utilization of resources. Activity (turnover) ratios are also called efficiency ratios.
(C) Debt equity Ratio — this matches (III) Long term solvency. It is a solvency ratio, long-term in nature.
(D) Interest Coverage Ratio — this matches (I) How many times interest on long term debt is covered by the Profits before Interest and tax. It is profit before interest and tax divided by interest on long-term debt.
NCERT (2026-27 edition):
NCERT (2026-27 edition): NCERT (2026-27 edition): NCERT (2026-27 edition):
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