Exam 13: Financial Analysis: The Big Picture

Net sales are $3,000,000, beginning total assets are $1,400,000, and the asset turnover is 2.5 times. What is the ending total asset balance?

Bill's Dollar Store had a balance in the Accounts Receivable account of $760,000 at the beginning of the year and a balance of $840,000 at the end of the year. Net credit sales during the year amounted to $6,880,000. The accounts receivable turnover was

Using these data from the comparative balance sheet of K. Leen Company, perform vertical analysis. December 31, 2014 December 31, 2013 Accounts receivable \ 400,000 \ 400,000 Inventory 864,000 600,000 Total assets 3,200,000 3,000,000

Listed below are some selected Items that may appear on a corporate income statement. Indicate the order in which these items would appear on an income statement. (The first one should be assigned the number "1", the second "2," etc.) ____Extraordinary item ____Income before income taxes ____Discontinued operations ____Net income ____Income from continuing operations ____Income tax expense

Which of the following income statement figures would probably be the best indicator of a company's future performance?

The following information pertains to Blue Flower 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) 30,000 Inventory 15,000 Property, plant and equipment 210,000 Total Assets \ 300,000 Liabilities and Stockholders' Equity Current liabilities \ 60,000 Long-term liabilities 90,000 Stockholders' equity-Common 150,000 Total Liabilities and Stockholders' Equity \ 300,000 Income Statement Sales revenue \ 121,000 Cost of goods sold 66,000 Gross margin 55,000 Operating expenses 30,000 Net income \ 25,000 Number of shares of common stock 6,000 Market price of common stock \ 20 Dividends per share on common stock 50 Cash provided by operations \ 40,000 What is the current ratio for this company?

Trading on the equity (leverage) refers to the

Net sales are $2,400,000, beginning total assets are $700,000, and the asset turnover is 3.0. What is the ending total asset balance?

The ______________ ratio measures the percentage of earnings distributed in the form of cash dividends.

The following data are taken from the financial statements of Bar Harbor Company: 2014 2013 Average accounts receivable \ 530,000 \ 550,000 Net sales on account 5,800,000 5,200,000 Terms for all sales are 2/10,/30 Instructions (a) Compute the accounts receivable turnover and the average collection period for both years. (b) What conclusion can an analyst draw about the management of the accounts receivable?

A successful grocery store would probably have

Reardon Inc. has an investment in trading securities of $120,000. This investment experienced an unrealized loss of $6,000 during the current year. Assuming a 35% tax rate, the effect of this loss on comprehensive income will be

The accounting for each of the following is the same under IFRS and GAAP except for

A current ratio of 1.2 to 1 indicates that a company's current assets exceed its current liabilities.

The following items were taken from the financial statements of St. Johns, Inc., over a four-year period: Item Net Sales \ 655,000 \ 640,000 \ 575,000 \ 500,000 Cost of Goods Sold Gross Profit Instructions Using horizontal analysis and 2012 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.

Comparisons of financial data made within a company are called

An income statement would not include

Horizontal, vertical, and circular analyses are the basic tools of financial statement analysis.

Match the ratios with their formulas by entering the appropriate letter in the space provided. - $\frac{\text {Net cash provided by operating activities }}{\text {Average current liabilities }}$