ACTIVITY RATIO Definition

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ACTIVITY RATIO is any accounting ratio that measures a firms ability to convert different accounts within their balance sheets into cash or sales.

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TOTAL LIABILITIES AND EQUITY is all claims on the company's total assets, by outsiders (liabilities) and the company owners/shareholders (equity).

STOCKOUT is running out of inventory, e.g. the demand or requirement for an item(s) cannot be fulfilled from existing inventory.

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