What two ratios fall under Funds Management Ratios?

The correct response highlights two essential components of funds management ratios, which are vital for assessing how effectively a company manages its assets and liabilities. The Inventory Turnover ratio measures how efficiently a company turns its inventory into sales, ensuring that funds are not tied up in stock. The Collection Period ratio evaluates how quickly a business collects its receivables, indicating how effectively it manages its cash flow and credit policies.

By focusing on these two ratios, organizations can gain insights into their operational efficiency and liquidity management. Understanding inventory and receivables is crucial for maintaining optimal funding levels and ensuring the sustainability of operations. Efficient management of these ratios can lead to better fund allocation and improved financial health overall.

Other options contain ratios that, while important in various financial analyses, do not directly pertain to the concept of funds management in the same manner. For instance, Return on Assets and Return on Equity measure profitability, while Debt to Equity provides insights into capital structure. The Current Ratio and Quick Ratio assess liquidity but are not as closely tied to managing specific operational efficiencies like Inventory Turnover and Collection Period are.