Question 1

Evaluation of company performance can include comparison and/or assessment of all but which of the following:

Accepted Answer

A)  Past performance. 
B)  Current performance. 
C)  Current financial position. 
D)  Future performance and risk. 
E)  External user needs and demands. 
A)  Past performance. 
B)  Current performance. 
C)  Current financial position. 
D)  Future performance and risk. 
E)  External user needs and demands.

Question 2

One purpose of financial statement analysis for internal users is to provide strategic information to improve company efficiency and effectiveness in providing products and services.

Accepted Answer

A) True 
 B)False

Question 3

Market prospects are the ability to provide financial rewards sufficient to attract and retain financing.

Accepted Answer

A) True 
 B)False

Question 4

A high level of expected risk suggests a low price-earnings (PE)ratio.

Accepted Answer

A) True 
 B)False

Question 5

Which of the following items is typically not included as a separate item after normal revenues and expenses?

Accepted Answer

A)  Write down of inventories. 
B)  Condemnation of property by the city government. 
C)  Loss of use of property due to a new and unexpected environmental regulation. 
D)  Loss due to an unusual and infrequent calamity. 
E)  Expropriation of property by a foreign government. 
A)  Write down of inventories. 
B)  Condemnation of property by the city government. 
C)  Loss of use of property due to a new and unexpected environmental regulation. 
D)  Loss due to an unusual and infrequent calamity. 
E)  Expropriation of property by a foreign government.

Question 6

When an item has a value in the base period and zero in the analysis period,the decrease is 0 percent.

Accepted Answer

A) True 
 B)False

Question 7

A component of operating efficiency and profitability,calculated by expressing net income as a percent of net sales,is the:

Accepted Answer

A)  Acid-test ratio. 
B)  Merchandise turnover. 
C)  Price earnings ratio. 
D)  Accounts receivable turnover. 
E)  Profit margin ratio. 
A)  Acid-test ratio. 
B)  Merchandise turnover. 
C)  Price earnings ratio. 
D)  Accounts receivable turnover. 
E)  Profit margin ratio.

Question 8

Horizontal analysis is the comparison of a company's financial condition and performance across time.

Accepted Answer

A) True 
 B)False

Question 9

Describe the purpose of horizontal financial statement analysis and how it is applied.

Accepted Answer

Horizontal analysis is a tool to evaluat

Question 10

The evaluation of company performance and financial condition focuses solely on past performance.

Accepted Answer

A) True 
 B)False

Question 11

A financial statement analysis report does not include:

Accepted Answer

A)  An auditor statement. 
B)  An analysis overview. 
C)  Evidential matter. 
D)  Qualitative and quantitative key factors. 
E)  Inferences such as forecasts. 
A)  An auditor statement. 
B)  An analysis overview. 
C)  Evidential matter. 
D)  Qualitative and quantitative key factors. 
E)  Inferences such as forecasts.

Question 12

A company reports basic earnings per share of $3.50,cash dividends per share of $1.25,and a market price per share of $64.75.The company's dividend yield equals:

Accepted Answer

A)  1.93%. 
B)  2.14%. 
C)  4.67%. 
D)  5.41%. 
E)  18.50%. 
A)  1.93%. 
B)  2.14%. 
C)  4.67%. 
D)  5.41%. 
E)  18.50%.

Question 13

Net sales divided by Average accounts receivable,net is the:

Accepted Answer

A)  Days' sales uncollected. 
B)  Average accounts receivable ratio. 
C)  Current ratio. 
D)  Profit margin. 
E)  Accounts receivable turnover ratio. 
A)  Days' sales uncollected. 
B)  Average accounts receivable ratio. 
C)  Current ratio. 
D)  Profit margin. 
E)  Accounts receivable turnover ratio.

Question 14

The market price of Horokhiv Corporation's common stock at the start of 2016 was $47.50 and it declared and paid cash dividends of $3.28 per share.The Dividend yield ratio is:

Accepted Answer

A)  14.5%. 
B)  7.4%. 
C)  6.5%. 
D)  144.8%. 
E)  6.9%. 
A)  14.5%. 
B)  7.4%. 
C)  6.5%. 
D)  144.8%. 
E)  6.9%.

Question 15

Three of the most common tools of financial analysis are (1)________, (2)________,and (3)________.

Accepted Answer

horizontal analysis;

Question 16

Horizontal analysis:

Accepted Answer

A)  Is a method 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 relative to industry statistics. 
E)  Evaluates financial data across industries. 
A)  Is a method 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 relative to industry statistics. 
E)  Evaluates financial data across industries.

Question 17

The percent change of a comparative financial statement item is computed by subtracting the base period amount from the analysis period amount,dividing the result by the base period amount and multiplying that result by 100.

Accepted Answer

A) True 
 B)False

Question 18

A good financial statement analysis report usually includes the following six sections: (1)________, (2)________, (3)________, (4)________ (5)________,and (6)________.

Accepted Answer

executive summary; a

Question 19

Information from a manufacturing company's current year income statement follows.Calculate the company's (a)profit margin ratio, (b)gross margin ratio,and (c)times interest earned.
 $\begin{array}{|l|r|}
\hline \text { Sales } & \$ 850,000 \
\hline \text { Cost of goods sold } & 455,000 \
\hline \text { Gross profit } & \$ 395,000 \
\hline \text { Operating expenses } & 260,000 \
\hline \text { Operating income } & \$ 135,00 \
\hline \text { Interest expense } & \$ 32,000 \
\hline \text { Income before taxes } & \$ 103,000 \
\hline \text { Income taxes expense } & 12,400 \
\hline \text { Net income } & \$ 90,600\
\hline 
\end{array}$

Accepted Answer

The answer of Information from a manufacturing company's current year...

Question 20

Match each of the following terms with the appropriate formulas.
-$\frac {\text {  Ending inventory}} { \text {Cost of goods sold } }$

* 365

Accepted Answer

A) Debt ratio 
B) Days' sales in inventory 
C) Return on common stockholders' equity 
D) Inventory turnover 
E) Dividend yield
F)Days' sales uncollected
G)Profit margin ratio
H)Gross margin ratio
I)Times interest earned
J)Total asset turnover 
A) Debt ratio 
B) Days' sales in inventory 
C) Return on common stockholders' equity 
D) Inventory turnover 
E) Dividend yield
F)Days' sales uncollected
G)Profit margin ratio
H)Gross margin ratio
I)Times interest earned
J)Total asset turnover

Evaluation of company performance can include comparison and/or assessment of all but which of the following:

One purpose of financial statement analysis for internal users is to provide strategic information to improve company efficiency and effectiveness in providing products and services.

Market prospects are the ability to provide financial rewards sufficient to attract and retain financing.

A high level of expected risk suggests a low price-earnings (PE)ratio.

Which of the following items is typically not included as a separate item after normal revenues and expenses?

When an item has a value in the base period and zero in the analysis period,the decrease is 0 percent.

A component of operating efficiency and profitability,calculated by expressing net income as a percent of net sales,is the:

Horizontal analysis is the comparison of a company's financial condition and performance across time.

Describe the purpose of horizontal financial statement analysis and how it is applied.

The evaluation of company performance and financial condition focuses solely on past performance.

A financial statement analysis report does not include:

A company reports basic earnings per share of $3.50,cash dividends per share of $1.25,and a market price per share of $64.75.The company's dividend yield equals:

Net sales divided by Average accounts receivable,net is the:

The market price of Horokhiv Corporation's common stock at the start of 2016 was $47.50 and it declared and paid cash dividends of $3.28 per share.The Dividend yield ratio is:

Three of the most common tools of financial analysis are (1), (2),and (3).

Horizontal analysis:

The percent change of a comparative financial statement item is computed by subtracting the base period amount from the analysis period amount,dividing the result by the base period amount and multiplying that result by 100.

A good financial statement analysis report usually includes the following six sections: (1), (2), (3), (4) (5),and (6).

Match each of the following terms with the appropriate formulas. - $\frac {\text { Ending inventory}} { \text {Cost of goods sold } }$ * 365

Accounting in Business

Analyzing for Business Transactions

Adjusting Accounts for Financial Statements

Accounting for Merchandising Operations

Inventories and Cost of Sales

Cash, fraud, and Internal Controls

Accounting for Receivables

Accounting for Long-Term Assets

Accounting for Current Liabilities

Accounting for Long-Term Liabilities

Corporate Reporting and Analysis

Reporting Cash Flows

Time Value of Money

Investments

Partnership Accounting

Filters

Exam 13: Analysis of Financial Statements

Evaluation of company performance can include comparison and/or assessment of all but which of the following:

One purpose of financial statement analysis for internal users is to provide strategic information to improve company efficiency and effectiveness in providing products and services.

Market prospects are the ability to provide financial rewards sufficient to attract and retain financing.

A high level of expected risk suggests a low price-earnings (PE)ratio.

Which of the following items is typically not included as a separate item after normal revenues and expenses?

When an item has a value in the base period and zero in the analysis period,the decrease is 0 percent.

A component of operating efficiency and profitability,calculated by expressing net income as a percent of net sales,is the:

Horizontal analysis is the comparison of a company's financial condition and performance across time.

Describe the purpose of horizontal financial statement analysis and how it is applied.

The evaluation of company performance and financial condition focuses solely on past performance.

A financial statement analysis report does not include:

A company reports basic earnings per share of $3.50,cash dividends per share of $1.25,and a market price per share of $64.75.The company's dividend yield equals:

Net sales divided by Average accounts receivable,net is the:

The market price of Horokhiv Corporation's common stock at the start of 2016 was $47.50 and it declared and paid cash dividends of $3.28 per share.The Dividend yield ratio is:

Three of the most common tools of financial analysis are (1)________, (2)________,and (3)________.

Horizontal analysis:

The percent change of a comparative financial statement item is computed by subtracting the base period amount from the analysis period amount,dividing the result by the base period amount and multiplying that result by 100.

A good financial statement analysis report usually includes the following six sections: (1)________, (2)________, (3)________, (4)________ (5)________,and (6)________.

Match each of the following terms with the appropriate formulas. - Ending inventoryCost of goods sold \frac {\text { Ending inventory}} { \text {Cost of goods sold } }Cost of goods sold Ending inventory​ * 365

Accounting in Business

Analyzing for Business Transactions

Adjusting Accounts for Financial Statements

Accounting for Merchandising Operations

Inventories and Cost of Sales

Cash, fraud, and Internal Controls

Accounting for Receivables

Accounting for Long-Term Assets

Accounting for Current Liabilities

Accounting for Long-Term Liabilities

Corporate Reporting and Analysis

Reporting Cash Flows

Time Value of Money

Investments

Partnership Accounting

Filters

Three of the most common tools of financial analysis are (1), (2),and (3).

A good financial statement analysis report usually includes the following six sections: (1), (2), (3), (4) (5),and (6).

Match each of the following terms with the appropriate formulas. - $\frac {\text { Ending inventory}} { \text {Cost of goods sold } }$ * 365