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CIMAPRA17-BA3-1 Exam - Topic 1 Question 94 Discussion

Actual exam question for CIMA's CIMAPRA17-BA3-1 exam
Question #: 94
Topic #: 1
[All CIMAPRA17-BA3-1 Questions]

ABC produces accounts to the year ended 31 December annually Extracts from the most recent financial statements are.

Which of the following ratios is a liquidity ratio?

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Suggested Answer: D

by Carolynn at Aug 05, 2024, 12:01 AM

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Angelica
3 months ago
Totally agree with D, it's straightforward!
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Nenita
3 months ago
Really? I always get confused with these ratios.
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Hoa
3 months ago
Current assets/current liabilities is the classic liquidity ratio.
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Anglea
4 months ago
I thought A was a liquidity ratio?
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Isadora
4 months ago
D is definitely the liquidity ratio!
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Daniel
4 months ago
I’m a bit confused; I thought Operating profit ratios were also important, but they don’t seem to fit the liquidity category.
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Elmira
4 months ago
I’m not entirely confident, but I feel like Current assets over Current liabilities is definitely a liquidity ratio.
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Stefania
4 months ago
I remember practicing similar questions, and I’m pretty sure that Debt/Equity is more about leverage than liquidity.
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Vincenza
5 months ago
I think liquidity ratios measure a company's ability to cover short-term obligations, so I’m leaning towards option D.
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Elizabeth
5 months ago
I'm a little lost on this one. I know liquidity ratios measure a company's short-term financial health, but I'm having trouble remembering the specific formulas. Maybe I'll try to eliminate the options that clearly aren't liquidity ratios and then make an educated guess.
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Charlie
5 months ago
Hmm, I'm a bit unsure about this one. I know liquidity ratios have to do with a company's ability to pay its short-term obligations, but I'm not totally confident in my ability to identify them. I'll have to think this through carefully.
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Tiara
5 months ago
This looks like a straightforward financial ratio question. I'll start by identifying the liquidity ratios I know, like current ratio and quick ratio, and see if any of the options match those.
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Pamella
5 months ago
Okay, I've got this. The current ratio, which is current assets divided by current liabilities, is a classic liquidity ratio. That matches option D, so I'm going with that.
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Sue
5 months ago
Okay, I think I've got this. If we apply rule sets rather than individual context rules, that would be the true answer. Let me double-check my understanding before selecting the final answer.
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Clare
5 months ago
I practiced with a few similar exam questions, and "cloud-mis qos" was an option before. I don't think that's it here, though.
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Timothy
2 years ago
D) Current assets/Current liabilities is the only one that doesn't sound like a joke. I mean, who would use 'Debt/Equity' as a liquidity ratio?
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Kimberlie
1 year ago
Definitely, 'Debt/Equity' sounds more like a leverage ratio.
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Kimberlie
1 year ago
I think 'Current assets/Current liabilities' is the correct liquidity ratio.
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Kimberlie
1 year ago
I agree, 'Debt/Equity' doesn't seem like a liquidity ratio.
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Ling
2 years ago
I agree, because it measures the company's ability to meet short-term obligations.
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Adaline
2 years ago
I'd go with D, can't go wrong with the old current ratio. The other options are just too random to be liquidity ratios.
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Nicolette
1 year ago
It's always good to stick with the basics when it comes to analyzing financial statements.
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Romana
1 year ago
Definitely, the current ratio is a key indicator of a company's liquidity position.
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Marg
1 year ago
Yeah, D is a classic ratio that measures a company's ability to cover its short-term liabilities with its short-term assets.
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Elin
1 year ago
I agree, D is the most straightforward choice for a liquidity ratio.
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Lai
2 years ago
I believe the correct answer is D) Current assets/Current liabilities.
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Ling
2 years ago
Yes, it is asking which ratio is a liquidity ratio.
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Honey
2 years ago
Gotta be D, the current ratio is a classic liquidity measure. The others are more profitability or efficiency ratios.
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Pauline
2 years ago
Yes, D is the current ratio which shows how easily a company can cover its short-term debts.
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Kaycee
2 years ago
I agree, D is the correct answer. It measures the company's ability to pay off its short-term liabilities.
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Lai
2 years ago
I think the question is about liquidity ratios.
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Miesha
2 years ago
D) Current assets/Current liabilities seems like the liquidity ratio to me. The others don't really fit the definition of a liquidity ratio.
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Ruthann
2 years ago
D) Current assets/Current liabilities seems like the liquidity ratio to me. The others don't really fit the definition of a liquidity ratio.
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Kattie
2 years ago
D) Current assets/Current liabilities
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Reid
2 years ago
C) Revenue/Capital employed
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Yun
2 years ago
B) Operating profit/Capital employed x 100%
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Lino
2 years ago
A) Debt/Equity x 100%
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