Some questions (1 Viewer)

[XcarvengerX]

1. When you write ratio, like liquidity ratio, do you write it something is to one or one is to something? eg.
CA : CL
10000 : 15000
1 : 1.5 OR 0.66 : 1

2. When you calculate return on owner's equity, do you include retained profit (net profit) in your owner's equity or not? eg.
Jane invested $18000, her net profit after a year is $1500. Calculate her return on owner's equity. So:
net profit over owner's equity
1500 : 18000 OR 1500 : 19500

Thank you.

 

[Always]

1. 0.66:1 - 66c of CA to cover every $1 of CL.

2. 1500:19500 - Return on owner's equity = net profit/total owner's equity.

 

[XcarvengerX]

Yes, that's what I and my teacher think, but that other teacher (we have 3 business classes) who marks my test thinks otherwise and now I know that mine was correct. I don't care if I can't get the marks, now I know what is correct for HSC. Thanks.

 

[Loz_metalhead]

2. 1500:19500 - Return on owner's equity = net profit/total owner's equity.

Are you sure...I thought it would be 1500:18000

 

[gnrlies]

fraction form, or ratio form is acceptable.

Any teacher who marks otherwise is an idiot and needs to go back to uni.