Exam 14: Managerial Accounting

Assume the following cost of goods sold data for a company: 2017 \ 1,704,000 2016 1,400,000 2015 1,200,000 If 2015 is the base year, what is the percentage increase in cost of goods sold from 2015 to 2017?

The debt to assets ratio

Fess Hardware Store had net credit sales of $8,500,000 and cost of goods sold of $5,000,000 for the year.The Accounts Receivable balances at the beginning and end of the year were $600,000 and $760,000, respectively.The accounts receivable turnover was

Comparisons of data within a company are an example of the following comparative basis:

A supplier to a company would be most interested in the company's

Horizontal analysis is a technique for evaluating a financial statement item in the current year with other items in the current year.

Inventory turnover is calculated by dividing

Calculating financial ratios is a financial reporting requirement under generally accepted accounting principles.

The current ratio is a measure of all the ratios calculated for the current year.

What type of ratios best measure the short-term ability of the enterprise to pay its maturing obligations and to meet unexpected needs for cash?

The following financial statement information is available for Long Corporation: 2017 2016 Net income \ 115,000 \ 80,000 Income tax expense 30,000 29,000 Interest expense 18,000 14,000 Dividends paid to preferred stockholders 22,000 20,000 Dividends paid to preferred stockholders 15,000 10,000 The times interest earned for 2017 is

Times interest earned is also called the

Saira, Inc.has the following income statement (in millions): SAIRA, INC. Income Statement For the Year Ended December 31, 2017 Net Sales \ 300 Cost of Goods Sold 180 Gross Profit 120 Operating Expenses 45 Net Income \ 75 Using vertical analysis, what percentage is assigned to Cost of Goods Sold?

If a company has sales of $110 in 2016 and $154 in 2017, the percentage increase in sales from 2016 to 2017 is 140%.

The following information pertains to Rural Company.Assume that all balance sheet amounts represent both average and ending balance figures. Assume that all sales were on credit. Assets Cash and short-term investments \ 40,000 Accounts receivable (net) 30,000 Inventory 27,000 Property, plant and equipment 215,000 Total Assets \3 12,500 Liabilities and Stockholders' Equity Current liabilities \ 60,000 Long-term liabilities 75,000 Stockholders' equity-common 177,000 Total Liabilities and Stockholders' Equity \3 12,500 Income Statement Sales \ 90,000 Cost of goods sold 40,000 Gross profit \5 0,000 Operating expenses 25,000 Net income \2 5,000 Number of shares of common stock 5,000 Market price of common stock \ 21 Dividends per share 1.00 What is the return on assets for Rural?

Horizontal analysis is appropriately performed

The following information pertains to Ortiz Company.Assume that all balance sheet amounts represent both average and ending balance figures.Assume that all sales were on credit. Assets Cash and short-term investments \ 45,000 Accounts receivable (net) 25,000 Inventory 20,000 Property, plant and equipment 210,000 Total Assets \3 00,000 Liabilities and Stockholders' Equity Current liabilities \ 50,000 Long-term liabilities 90,000 Stockholders' equity-common 160,000 Total Liabilities and Stockholders' Equity \3 00,000 Income Statement Sales \ 100,000 Cost of goods sold 55,000 Gross profit \4 5,000 Operating expenses 15,000 Net income \3 0,000 Number of shares of common stock 6,000 Market price of common stock \ 30 Dividends per share .50 What is the price-earnings ratio for Ortiz?

The ratios that are used to determine a company's short-term debt paying ability are

A percentage change can be computed only if the base amount is zero or positive.

A ratio can be expressed as a percentage, a rate, or a proportion.