Match List – I with List – II. LIST I (Types of Ratio) LIST II (Categ… | Accountancy Part B CUET question

Match List – I with List – II.

LIST I (Types of Ratio)	LIST II (Categorisation)
A. Current Ratio	I. Profitability Ratio
B. Proprietary Ratio	II. Solvency Ratio
C. Inventory Turnover Ratio	III. Liquidity Ratio
D. Earning Per Share	IV. Activity Ratio

Choose the correct answer from the options given below :

Answer & explanation

Correct answer: option 4

The correct answer is Option (4) → A-III, B-II, C-IV, D-I

Ratios are grouped by what they measure.

A. Current Ratio — this matches III. Liquidity Ratio. It measures short-term solvency.

B. Proprietary Ratio — this matches II. Solvency Ratio. It shows how far total assets are financed by shareholders’ funds.

C. Inventory Turnover Ratio — this matches IV. Activity Ratio. It shows how fast inventory is turned into sales.

D. Earning Per Share — this matches I. Profitability Ratio. It measures profit earned per equity share.

NCERT (2026-27 edition):
Liquidity Ratios – “Liquidity ratios are calculated to measure the short-term solvency of the business, i.e. the firm’s ability to meet its current obligations. These are analysed by looking at the amounts of current assets and current liabilities in the balance sheet. The two ratios included in this category are current ratio and liquidity ratio.”

NCERT (2026-27 edition):
Solvency Ratios – “… Solvency ratios are calculated to determine the ability of the business to service its debt in the long run. The following ratios are normally computed for evaluating solvency of the business. 1. Debt-Equity Ratio; 2. Debt to Capital Employed Ratio; 3. Proprietary Ratio; 4. Total Assets to Debt Ratio; 5. Interest Coverage Ratio.”

NCERT (2026-27 edition):
Activity (or Turnover) Ratio

Extract from the NCERT textbook

NCERT (2026-27 edition):
Profitability Ratios

Extract from the NCERT textbook

Match List – I with List – II.

LIST I (Types of Ratio)	LIST II (Categorisation)
A. Current Ratio	I. Profitability Ratio
B. Proprietary Ratio	II. Solvency Ratio
C. Inventory Turnover Ratio	III. Liquidity Ratio
D. Earning Per Share	IV. Activity Ratio

Choose the correct answer from the options given below :

Answer & explanation

Correct answer: option 4

The correct answer is Option (4) → A-III, B-II, C-IV, D-I

Ratios are grouped by what they measure.

A. Current Ratio — this matches III. Liquidity Ratio. It measures short-term solvency.

B. Proprietary Ratio — this matches II. Solvency Ratio. It shows how far total assets are financed by shareholders’ funds.

C. Inventory Turnover Ratio — this matches IV. Activity Ratio. It shows how fast inventory is turned into sales.

D. Earning Per Share — this matches I. Profitability Ratio. It measures profit earned per equity share.

NCERT (2026-27 edition):
Activity (or Turnover) Ratio

Extract from the NCERT textbook

NCERT (2026-27 edition):
Profitability Ratios

Extract from the NCERT textbook