Question 1

Bob's Burgers has total assets of $425 million.Its total liabilities are $100 million.Its equity is $285 million.Calculate the debt ratio.

Accepted Answer

A) 35.1% 
B) 23.5% 
C) 38.5% 
D) 28.5% 
E) 58.8% 
A) 35.1% 
B) 23.5% 
C) 38.5% 
D) 28.5% 
E) 58.8%

Question 2

Horizontal analysis

Accepted Answer

A) Is a tool used to evaluate changes in financial data across time 
B) Is also called vertical analysis 
C) Is the presentation of financial ratios 
D) Is a tool used to evaluate financial statement items in terms of a specific base amount 
E) Is a tool used to evaluate changes in financial data across time and is the presentation of financial ratios 
A) Is a tool used to evaluate changes in financial data across time 
B) Is also called vertical analysis 
C) Is the presentation of financial ratios 
D) Is a tool used to evaluate financial statement items in terms of a specific base amount 
E) Is a tool used to evaluate changes in financial data across time and is the presentation of financial ratios

Question 3

TechCom had net sales of $315,000 and average accounts receivable of $75,600.Its competitor,ZCom,had net sales of $299,000 and average accounts receivable of $81,350.Calculate the accounts receivable turnover for both companies.Which company is doing a better job of managing its accounts receivable?

Accepted Answer

TechCom = 4.2,ZCom = 3.7.TechC

Question 4

Anheuser-Busch had average total assets of $109,650 and net sales of $114,330.Its total asset turnover was 0.96.

Accepted Answer

A) True 
 B)False

Question 5

A company should maintain a current ratio of two to one when

Accepted Answer

A) Estimating customer demand is difficult 
B) The company grants little or no credit 
C) The company is selling low priced clothing 
D) Inventory turns over frequently 
E) The company has little inventory 
A) Estimating customer demand is difficult 
B) The company grants little or no credit 
C) The company is selling low priced clothing 
D) Inventory turns over frequently 
E) The company has little inventory

Question 6

The ability to meet short-term obligations and to efficiently generate revenues is called

Accepted Answer

A) Liquidity and efficiency 
B) Solvency 
C) Profitability 
D) Market 
E) Creditworthiness 
A) Liquidity and efficiency 
B) Solvency 
C) Profitability 
D) Market 
E) Creditworthiness

Question 7

The four building blocks of financial statement analysis include (1)liquidity,(2)creditworthiness,(3)solvency,and (4)profitability.

Accepted Answer

A) True 
 B)False

Question 8

Explain the debt ratio and its use in analyzing a company's performance.

Accepted Answer

The debt ratio is calculated by dividing

Question 9

Chapter's had net sales of $26,125 million.Its cost of goods sold was $16,022 million.Its profit was $997 million.Its gross profit ratio was

Accepted Answer

A) 3.5% 
B) 67% 
C) 38.6% 
D) 5.2% 
E) 149.3% 
A) 3.5% 
B) 67% 
C) 38.6% 
D) 5.2% 
E) 149.3%

Question 10

CompUS has pledged $275,000 worth of its assets.The total book value of its assets is $625,000.The firm's total liabilities are $750,000.The secured liabilities are $150,000.The pledged assets to secured liabilities is

Accepted Answer

A) 1.2 
B) 1.8 
C) 2.3 
D) 2.7 
E) 5.0 
A) 1.2 
B) 1.8 
C) 2.3 
D) 2.7 
E) 5.0

Question 11

Phoenix Corp had profit of $145,500,net sales of $1,379,690,and average total assets of $1,026,650.Calculate the profit margin,total asset turnover,and return on total assets.

Accepted Answer

Profit margin: $145,500/$1,379

Question 12

General-purpose financial statements include the (1)income statement,(2)balance sheet,(3)statement of changes in equity,(4)statement of cash flows,and (5)notes related to the statements.

Accepted Answer

A) True 
 B)False

Question 13

Financial statement analysis is the application of analytical tools to general-purpose financial statements and related data for making business decisions.

Accepted Answer

A) True 
 B)False

Question 14

Financial statement analysis lessens the need for expert judgment.

Accepted Answer

A) True 
 B)False

Question 15

Total asset turnover can be calculated regardless of the type of company being evaluated.

Accepted Answer

A) True 
 B)False

Question 16

In the current year,Pear Co.had total assets of $250,000 and liabilities of $100,000.Calculate the debt ratio.

Accepted Answer

$100,000/$

Question 17

The price-earnings ratio is calculated by

Accepted Answer

A) Dividing dividends by earnings per share 
B) Dividing earnings per share by market price per share 
C) Dividing market price per share by earnings per share 
D) Dividing dividends by market price per share 
E) Dividing market price per share by dividends 
A) Dividing dividends by earnings per share 
B) Dividing earnings per share by market price per share 
C) Dividing market price per share by earnings per share 
D) Dividing dividends by market price per share 
E) Dividing market price per share by dividends

Question 18

The ratio of a company's book value of pledged assets to the book value of its secured liabilities is called the

Accepted Answer

A) Pledged assets to secured liabilities 
B) Return on total assets 
C) Debt ratio 
D) Profit margin 
E) Times secured liabilities earned 
A) Pledged assets to secured liabilities 
B) Return on total assets 
C) Debt ratio 
D) Profit margin 
E) Times secured liabilities earned

Question 19

The gross profit ratio

Accepted Answer

A) Measures the relationship between net sales and cost of goods sold 
B) Is a profitability measure 
C) Measures the amount of gross profit in each dollar of sales 
D) Measures the relationship between net sales and cost of goods sold and is a profitability measure 
E) All of these 
A) Measures the relationship between net sales and cost of goods sold 
B) Is a profitability measure 
C) Measures the amount of gross profit in each dollar of sales 
D) Measures the relationship between net sales and cost of goods sold and is a profitability measure 
E) All of these

Question 20

Graphical analysis is useful in assessing sources of financing and identification of investing activities.

Accepted Answer

A) True 
 B)False

Bob's Burgers has total assets of $425 million.Its total liabilities are $100 million.Its equity is $285 million.Calculate the debt ratio.

Horizontal analysis

TechCom had net sales of $315,000 and average accounts receivable of $75,600.Its competitor,ZCom,had net sales of $299,000 and average accounts receivable of $81,350.Calculate the accounts receivable turnover for both companies.Which company is doing a better job of managing its accounts receivable?

Anheuser-Busch had average total assets of $109,650 and net sales of $114,330.Its total asset turnover was 0.96.

A company should maintain a current ratio of two to one when

The ability to meet short-term obligations and to efficiently generate revenues is called

The four building blocks of financial statement analysis include (1)liquidity,(2)creditworthiness,(3)solvency,and (4)profitability.

Explain the debt ratio and its use in analyzing a company's performance.

Chapter's had net sales of $26,125 million.Its cost of goods sold was $16,022 million.Its profit was $997 million.Its gross profit ratio was

CompUS has pledged $275,000 worth of its assets.The total book value of its assets is $625,000.The firm's total liabilities are $750,000.The secured liabilities are $150,000.The pledged assets to secured liabilities is

Phoenix Corp had profit of $145,500,net sales of $1,379,690,and average total assets of $1,026,650.Calculate the profit margin,total asset turnover,and return on total assets.

General-purpose financial statements include the (1)income statement,(2)balance sheet,(3)statement of changes in equity,(4)statement of cash flows,and (5)notes related to the statements.

Financial statement analysis is the application of analytical tools to general-purpose financial statements and related data for making business decisions.

Financial statement analysis lessens the need for expert judgment.

Total asset turnover can be calculated regardless of the type of company being evaluated.

In the current year,Pear Co.had total assets of $250,000 and liabilities of $100,000.Calculate the debt ratio.

The price-earnings ratio is calculated by

The ratio of a company's book value of pledged assets to the book value of its secured liabilities is called the

The gross profit ratio

Graphical analysis is useful in assessing sources of financing and identification of investing activities.

Property, plant and Equipment Intangibles

Current Liabilities

Partnerships

Organization and Operation of Corporations

Corporate Reporting: Income, earnings Per Share, and Retained Earnings

Bonds and Long-Term Notes Payable

Accounting for Debt and Share Investments

Reporting and Analyzing Cash Flows

Filters

Exam 9: Analyzing Financial Statements

Bob's Burgers has total assets of $425 million.Its total liabilities are $100 million.Its equity is $285 million.Calculate the debt ratio.

Horizontal analysis

Anheuser-Busch had average total assets of $109,650 and net sales of $114,330.Its total asset turnover was 0.96.

A company should maintain a current ratio of two to one when

The ability to meet short-term obligations and to efficiently generate revenues is called

The four building blocks of financial statement analysis include (1)liquidity,(2)creditworthiness,(3)solvency,and (4)profitability.

Explain the debt ratio and its use in analyzing a company's performance.

Chapter's had net sales of $26,125 million.Its cost of goods sold was $16,022 million.Its profit was $997 million.Its gross profit ratio was

CompUS has pledged $275,000 worth of its assets.The total book value of its assets is $625,000.The firm's total liabilities are $750,000.The secured liabilities are $150,000.The pledged assets to secured liabilities is

Phoenix Corp had profit of $145,500,net sales of $1,379,690,and average total assets of $1,026,650.Calculate the profit margin,total asset turnover,and return on total assets.

General-purpose financial statements include the (1)income statement,(2)balance sheet,(3)statement of changes in equity,(4)statement of cash flows,and (5)notes related to the statements.

Financial statement analysis is the application of analytical tools to general-purpose financial statements and related data for making business decisions.

Financial statement analysis lessens the need for expert judgment.

Total asset turnover can be calculated regardless of the type of company being evaluated.

In the current year,Pear Co.had total assets of $250,000 and liabilities of $100,000.Calculate the debt ratio.

The price-earnings ratio is calculated by

The ratio of a company's book value of pledged assets to the book value of its secured liabilities is called the

The gross profit ratio

Graphical analysis is useful in assessing sources of financing and identification of investing activities.

Property, plant and Equipment Intangibles

Current Liabilities

Partnerships

Organization and Operation of Corporations

Corporate Reporting: Income, earnings Per Share, and Retained Earnings

Bonds and Long-Term Notes Payable

Accounting for Debt and Share Investments

Reporting and Analyzing Cash Flows

Filters