Question 1

The inventory turnover ratio measures the number of days the average balance of accounts receivable is outstanding before being converted into cash.

Accepted Answer

A) True 
 B)False  False

Question 2

Goslier Company's net income last year was $130,000.The company paid preferred dividends of $42,000 and its average common stockholders' equity was $610,000.The company's return on common stockholders' equity for the year was closest to

Accepted Answer

A) 15.8%. 
B) 28.1%. 
C) 21.3%. 
D) 14.4%. 
A) 15.8%. 
B) 28.1%. 
C) 21.3%. 
D) 14.4%. D

Question 3

Terms of sale can produce statistical variations among companies within the same industry.

Accepted Answer

A) True 
 B)False  True

Question 4

Opis Company has total assets of $475,000 and total liabilities of $130,000.The company's debt-to-equity ratio is closest to

Accepted Answer

A) .32. 
B) .21. 
C) .38. 
D) .27. 
A) .32. 
B) .21. 
C) .38. 
D) .27.

Question 5

For meaningful analysis,ratios should be compared with a standard.

Accepted Answer

A) True 
 B)False

Question 6

Labor markets can impact industrial statistics and standards.

Accepted Answer

A) True 
 B)False

Question 7

Last year the return on total assets in Justin Company was 8.5 percent.The total assets were $2,900,000 at the beginning of the year and $3,100,000 at the end of the year.The tax rate was 30 percent,interest expense totaled $110,000,and sales were $5,200,000.Net income for the year was

Accepted Answer

A) $145,000. 
B) $222,000. 
C) $332,000. 
D) $178,000. 
A) $145,000. 
B) $222,000. 
C) $332,000. 
D) $178,000.

Question 8

Chaney Inc.wants to measure the relationship between profitability and the investment made by stockholders.Chaney should use

Accepted Answer

A) return on common stockholders' equity. 
B) earnings per share. 
C) return on sales. 
D) The statement of retained earnings. 
A) return on common stockholders' equity. 
B) earnings per share. 
C) return on sales. 
D) The statement of retained earnings.

Question 9

The following items were taken from the financial statements of Ritz Inc.,over a four-year period:
   Required: Using horizontal analysis and 2009 as the base year,compute the trend percentages for net sales,cost of goods sold,and gross profit.Explain whether the trends are favorable or unfavorable for each item.

Accepted Answer

@#IMG-DLM& The trend in net sales is increasing an

Question 10

In the vertical analysis of a balance sheet,the base for current liabilities is total liabilities.

Accepted Answer

A) True 
 B)False

Question 11

Presented below are selected data from the financial statements of eMonstore.com for 2012,2011,and 2010.

Accepted Answer

The answer of Presented below are selected data from the...

Question 12

The quick ratio

Accepted Answer

A) is used to quickly determine a company's leverage and long-term debt-paying ability. 
B) relates cash,marketable securities,and net receivables to current liabilities. 
C) is calculated by taking one item from the income statement and one item from the balance sheet. 
D) is the same as the current ratio except it is rounded to the nearest whole percent. 
A) is used to quickly determine a company's leverage and long-term debt-paying ability. 
B) relates cash,marketable securities,and net receivables to current liabilities. 
C) is calculated by taking one item from the income statement and one item from the balance sheet. 
D) is the same as the current ratio except it is rounded to the nearest whole percent.

Question 13

Return on sales is calculated by dividing

Accepted Answer

A) sales by cost of goods sold. 
B) gross profit by net sales. 
C) net income by stockholders' equity. 
D) net income by sales. 
A) sales by cost of goods sold. 
B) gross profit by net sales. 
C) net income by stockholders' equity. 
D) net income by sales.

Question 14

Figure 16-7
     There were 30,000 shares of common stock outstanding throughout 2011.Dividends on common stock amounted to $21,000 and dividends on preferred stock amounted to $30,000.The market value of a share of common stock was $36 at the end of 2011.The income tax rate is 40%.The accounts receivable and inventory accounts had beginning balances of $58,500 and $101,400 respectively.Total assets at the beginning of the year were $430,500.
Refer to Figure 16-7.
Required: Calculate the following ratios: 
A.Current ratio
B.Quick ratio
C.Accounts receivable turnover ratio and accounts receivable turnover in days
D.Inventory turnover ratio and inventory turnover in days

Accepted Answer

A. Current ratio = Current assets/Curren

Question 15

Which profitability ratio requires the use of earnings per share and the current market price?

Accepted Answer

A) Return on common stockholders' equity 
B) Dividend payout ratio 
C) Dividend yield 
D) Price-earnings ratio 
A) Return on common stockholders' equity 
B) Dividend payout ratio 
C) Dividend yield 
D) Price-earnings ratio

Question 16

_________________ expresses a line item as a percentage of some prior-period amount.

Accepted Answer

The answer of _________________ expresses a line item as a...

Question 17

Boyle Corporation had the following comparative current assets and current liabilities:

Accepted Answer

During 2012,credit sales and c

Question 18

Data concerning Bouerneuf Company's common stock follow:   The price-earnings ratio would be

Accepted Answer

A) 2.0. 
B) 2.7. 
C) 3.0. 
D) 4.0. 
A) 2.0. 
B) 2.7. 
C) 3.0. 
D) 4.0.

Question 19

Figure 16-4.
Condensed financial statements for Black Company appear below:
     There were 72,000 shares of common stock outstanding throughout the 2012.Dividends on common stock amounted to $320,400 and dividends on preferred stock amounted to $45,000.The market value of a share of common stock was $54 at the end of 2012.The income tax rate is 30%.
Refer to Figure 16-4.
Required: Calculate the following liquidity ratios for 2012.

Accepted Answer

The answer of Figure 16-4.
Condensed financial statements for Black Company...

Question 20

Lost Shoe Company,a retailer,had cost of goods sold of $220,000 last year.The beginning inventory balance was $30,000 and the ending inventory balance was $21,000.The company's inventory turnover ratio was closest to

Accepted Answer

A) 10.48. 
B) 7.33. 
C) 4.31. 
D) 8.63. 
A) 10.48. 
B) 7.33. 
C) 4.31. 
D) 8.63.

The inventory turnover ratio measures the number of days the average balance of accounts receivable is outstanding before being converted into cash.

Goslier Company's net income last year was $130,000.The company paid preferred dividends of $42,000 and its average common stockholders' equity was $610,000.The company's return on common stockholders' equity for the year was closest to

Terms of sale can produce statistical variations among companies within the same industry.

Opis Company has total assets of $475,000 and total liabilities of $130,000.The company's debt-to-equity ratio is closest to

For meaningful analysis,ratios should be compared with a standard.

Labor markets can impact industrial statistics and standards.

Last year the return on total assets in Justin Company was 8.5 percent.The total assets were $2,900,000 at the beginning of the year and $3,100,000 at the end of the year.The tax rate was 30 percent,interest expense totaled $110,000,and sales were $5,200,000.Net income for the year was

Chaney Inc.wants to measure the relationship between profitability and the investment made by stockholders.Chaney should use

In the vertical analysis of a balance sheet,the base for current liabilities is total liabilities.

Presented below are selected data from the financial statements of eMonstore.com for 2012,2011,and 2010.

The quick ratio

Return on sales is calculated by dividing

Which profitability ratio requires the use of earnings per share and the current market price?

_________________ expresses a line item as a percentage of some prior-period amount.

Boyle Corporation had the following comparative current assets and current liabilities:

Data concerning Bouerneuf Company's common stock follow: The price-earnings ratio would be

Lost Shoe Company,a retailer,had cost of goods sold of $220,000 last year.The beginning inventory balance was $30,000 and the ending inventory balance was $21,000.The company's inventory turnover ratio was closest to

Introduction to Managerial Accounting

Basic Managerial Accounting Concepts

Cost Behavior

Cost-Volume-Profit Analysis: a Managerial Planning Tool

Job-Order Costing

Process Costing

Activity-Based Costing and Management

Absorption and Variable Costing,and Inventory Management

Profit Planning

Standard Costing: a Managerial Control Tool

Flexible Budgets and Overhead Analysis

Performance Evaluation and Decentralization

Short-Run Decision Making: Relevant Costing

Capital Investment Decisions

Statement of Cash Flows

Filters

Exam 16: Financial Statement Analysis

The inventory turnover ratio measures the number of days the average balance of accounts receivable is outstanding before being converted into cash.

Goslier Company's net income last year was $130,000.The company paid preferred dividends of $42,000 and its average common stockholders' equity was $610,000.The company's return on common stockholders' equity for the year was closest to

Terms of sale can produce statistical variations among companies within the same industry.

Opis Company has total assets of $475,000 and total liabilities of $130,000.The company's debt-to-equity ratio is closest to

For meaningful analysis,ratios should be compared with a standard.

Labor markets can impact industrial statistics and standards.

Last year the return on total assets in Justin Company was 8.5 percent.The total assets were $2,900,000 at the beginning of the year and $3,100,000 at the end of the year.The tax rate was 30 percent,interest expense totaled $110,000,and sales were $5,200,000.Net income for the year was

Chaney Inc.wants to measure the relationship between profitability and the investment made by stockholders.Chaney should use

In the vertical analysis of a balance sheet,the base for current liabilities is total liabilities.

Presented below are selected data from the financial statements of eMonstore.com for 2012,2011,and 2010.

The quick ratio

Return on sales is calculated by dividing

Which profitability ratio requires the use of earnings per share and the current market price?

_________________ expresses a line item as a percentage of some prior-period amount.

Boyle Corporation had the following comparative current assets and current liabilities:

Data concerning Bouerneuf Company's common stock follow: The price-earnings ratio would be

Lost Shoe Company,a retailer,had cost of goods sold of $220,000 last year.The beginning inventory balance was $30,000 and the ending inventory balance was $21,000.The company's inventory turnover ratio was closest to

Introduction to Managerial Accounting

Basic Managerial Accounting Concepts

Cost Behavior

Cost-Volume-Profit Analysis: a Managerial Planning Tool

Job-Order Costing

Process Costing

Activity-Based Costing and Management

Absorption and Variable Costing,and Inventory Management

Profit Planning

Standard Costing: a Managerial Control Tool

Flexible Budgets and Overhead Analysis

Performance Evaluation and Decentralization

Short-Run Decision Making: Relevant Costing

Capital Investment Decisions

Statement of Cash Flows

Filters