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Activity Ratio

Activity Ratio:

It is also called as turnover ratio. This ratio measures the efficiency of the current assets
and liabilities in the business concern during a particular period. This ratio is helpful to
understand the performance of the business concern. Some of the activity ratios are given
below:

Activity Ratio
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Stock Turnover Ratio = Cost of Sales / Average Inventory

Debtors Turnover Ratio = Credit Sales / Average Debtors

Creditors Turnover Ratio = Credit Purchase / Average Credit

Working Capital Turnover Ratio = Sales / Net Working Capital
Activity Ratio Activity Ratio Reviewed by Ikpokolo Francis on Sunday, February 26, 2017 Rating: 5

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