Exam 13: Financial Analysis: The Big Picture

If Hard in Parle Company had net income of $620,000 in 2014 and it experienced a 19% increase in net income over 2013, what was its 2013 net income?

Salamagundi, Inc. has the following Income Statement (in millions): SALAMAGUNDI, INC. Income Statement For the Year Ended December 31, 2014 Net Sales \ 160 Cost of Goods Sold 90 Gross Profit 70 Operating Expenses \ 40 Net Income \ 30 Using vertical analysis, what percentage is assigned to gross profit?

The following amounts were taken from the financial statements of Ando Company: 2014 2013 Total assets \ 800,000 \ 1,000,000 Net sales 720,000 650,000 Gross profit 352,000 320,000 Net income 144,000 11,000 Weighted average number of common shares outstanding 90,000 90,000 Market price of common stock \ 48 \ 39 The price-earnings ratio for 2014 is

From a creditor's point of view, the higher the debt to assets ratio, the lower the risk that the company may be unable to pay its obligations.

A high accounts receivable turnover indicates

Horizontal analysis is a technique for evaluating a series of financial statement data over a period of time

Vertical analysis is also known as

A comparison with other companies that provides insight into a company's competitive position is most commonly known as which of the following types of comparisons?

Improper recognition of income is not one of the factors affecting the quality of earnings.

The following amounts were taken from the financial statements of Ando Company: 2014 2013 Total assets \ 800,000 \ 1,000,000 Net sales 720,000 650,000 Gross profit 352,000 320,000 Net income 126,000 11,000 Weighted average number of common shares outstanding 90,000 90,000 Market price of common stock \ 35 \ 39 The return on assets for 2014 is

Chodron Corporation had net credit sales of $13,000,000 and cost of goods sold of $9,250,000 for the year. The average inventory for the year amounted to $2,500,000. The average days in inventory during the year was approximately

In performing a vertical analysis, the base for sales revenues on the income statement is

The current ratio would be of most interest to

If an item meets one (but not both) of the criteria for an extraordinary item, it

One objective of the income statement is to separate the results of continuing operations from those of discontinued operations.

Match the ratios with their formulas by entering the appropriate letter in the space provided. - $\frac{365 \text { days }}{\text { Accounts receivable turnover }}$

The following items were taken from the financial statements of Mint, Inc., over a three-year period: Item 2015 2014 2013 Net Sales \ 355,000 \ 336,000 \ 300,000 Cost of Goods Sold 214,000 206,000 186,000 Gross Profit \1 41,000 \1 30,000 \1 14,000 Instructions Compute the following for each of the above time periods. a. The amount and percentage change from 2013 to 2014. b. The amount and percentage change from 2014 to 2015.

Using these data from the comparative balance sheet of Sunta Fe Spice Company, perform horizontal analysis. December 31, 2014 December 31, 2013 Accounts receivable \ 375,000 \ 300,000 Inventory 780,000 600,000 Total assets 3,220,000 2,800,000

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

Here is financial information for Valdez Express Inc. Current assets \ 114,000 \ 80,000 Plant assets (net) 414,000 360,000 Current liabilities 91,000 65,000 Long-term liabilities 134,500 90,000 Common stock, \ 1 par 149,500 115,000 Retained earnings 153,000 170,000 Instructions Prepare a schedule showing a horizontal analysis for 2014 using 2013 as the base year.