Question 1

Horizontal analysis is analysis

Accepted Answer

A)  of percentage changes over two or more years. 
B)  in which all items are presented as a percentage of one selected item on a financial statement. 
C)  in which a statistic is calculated for the relationship between two items on a single financial statement or for two items on different financial statements. 
D)  of all ratios that increased or decreased over past accounting periods. 
A)  of percentage changes over two or more years. 
B)  in which all items are presented as a percentage of one selected item on a financial statement. 
C)  in which a statistic is calculated for the relationship between two items on a single financial statement or for two items on different financial statements. 
D)  of all ratios that increased or decreased over past accounting periods.

Question 2

Small sample sizes for an industrial report rarely cause a comparability problem in using standards.

Accepted Answer

A) True 
 B)False

Question 3

In the vertical analysis of a balance sheet, the base for current liabilities is total liabilities.

Accepted Answer

A) True 
 B)False

Question 4

Select the ratio that each statement below most properly satisfies.
-A measure of the degree of protection afforded creditors in case of insolvency

Accepted Answer

A) Dividend yield ratio 
B) Current ratio 
C) Debt ratio 
D) Return on common stockholders' equity ratio 
E) Times-interest-earned ratio
F)Quick ratio
G)Debt-to-equity ratio
H)Dividend payout ratio
I)Price-earnings ratio 
A) Dividend yield ratio 
B) Current ratio 
C) Debt ratio 
D) Return on common stockholders' equity ratio 
E) Times-interest-earned ratio
F)Quick ratio
G)Debt-to-equity ratio
H)Dividend payout ratio
I)Price-earnings ratio

Question 5

Select the ratio that each statement below most properly satisfies.
-A measure that tells an investor the proportion of earnings that a company pays in dividends

Accepted Answer

A) Dividend yield ratio 
B) Current ratio 
C) Debt ratio 
D) Return on common stockholders' equity ratio 
E) Times-interest-earned ratio
F)Quick ratio
G)Debt-to-equity ratio
H)Dividend payout ratio
I)Price-earnings ratio 
A) Dividend yield ratio 
B) Current ratio 
C) Debt ratio 
D) Return on common stockholders' equity ratio 
E) Times-interest-earned ratio
F)Quick ratio
G)Debt-to-equity ratio
H)Dividend payout ratio
I)Price-earnings ratio

Question 6

Which of the following types of analysis is useful in computing the relationships among the components of the financial statements for the same period?

Accepted Answer

A)  Vertical analysis 
B)  Horizontal analysis 
C)  Operational analysis 
D)  Ratio analysis 
A)  Vertical analysis 
B)  Horizontal analysis 
C)  Operational analysis 
D)  Ratio analysis

Question 7

Bogart Company has 40,000 shares of common stock outstanding.The book value per share of this stock was $60 and the market value per share was $75 at the end of the year.Net income for the year was $400,000.Interest on long-term debt was $40,000.Dividends paid to common stockholders were $3 per share.The tax rate was 30%.The company's price-earnings ratio at the end of the year was

Accepted Answer

A)  7.5. 
B)  20. 
C)  25. 
D)  6. 
A)  7.5. 
B)  20. 
C)  25. 
D)  6.

Question 8

The _________________ uses the income statement to assess a company's ability to service its debt.

Accepted Answer

times-inte

Question 9

Ruby Company's net income was $100,000 last year.The company has 25,000 shares of common stock and 6,000 shares of $50 par value, 6% preferred stock outstanding.There was no change in the number of common or preferred shares outstanding during the year.The earnings per share of common stock was:

Accepted Answer

A)  $9.12. 
B)  $7.63. 
C)  $3.28. 
D)  $2.35. 
A)  $9.12. 
B)  $7.63. 
C)  $3.28. 
D)  $2.35.

Question 10

Common-size analysis expresses each item in a financial statement as a percent of a base amount.

Accepted Answer

A) True 
 B)False

Question 11

Which of the following ratios is used by short-term creditors to assess the debt-paying ability of a company?

Accepted Answer

A)  Return on sales ratio 
B)  Current ratio 
C)  Inventory turnover ratio 
D)  Equity ratio 
A)  Return on sales ratio 
B)  Current ratio 
C)  Inventory turnover ratio 
D)  Equity ratio

Question 12

Nickel Store had net credit sales of $15,000,000 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 $875,000 and $375,000 respectively.The accounts receivable turnover ratio was:

Accepted Answer

A)  15 times. 
B)  10 times. 
C)  11 times. 
D)  24 times. 
A)  15 times. 
B)  10 times. 
C)  11 times. 
D)  24 times.

Question 13

Match the classifications of ratios with each description.
-Measures the degree of protection provided to company creditors

Accepted Answer

A) Liquidity Ratio 
B) Leverage Ratio 
C) Profitability Ratio 
D) Horizontal Analysis 
E) Trend Analysis 
A) Liquidity Ratio 
B) Leverage Ratio 
C) Profitability Ratio 
D) Horizontal Analysis 
E) Trend Analysis

Question 14

Common-size statements are statements of companies of similar size and operations.

Accepted Answer

A) True 
 B)False

Question 15

Which of the following formulas is used to calculate the inventory turnover ratio?

Accepted Answer

A)  Cost of Goods Sold / Ending Inventory 
B)  Sales / Beginning Inventory 
C)  Cost of Goods Sold / Average Inventory 
D)  Sales / Total Inventory 
A)  Cost of Goods Sold / Ending Inventory 
B)  Sales / Beginning Inventory 
C)  Cost of Goods Sold / Average Inventory 
D)  Sales / Total Inventory

Question 16

Which profitability ratio requires the use of earnings per share in its calculation?

Accepted Answer

A)  price-earnings ratio 
B)  return on common stockholders' equity 
C)  dividend yield 
D)  return on sales 
A)  price-earnings ratio 
B)  return on common stockholders' equity 
C)  dividend yield 
D)  return on sales

Question 17

Match the classifications of ratios with each description.
-Measures the earning ability of a company

Accepted Answer

A) Liquidity Ratio 
B) Leverage Ratio 
C) Profitability Ratio 
D) Horizontal Analysis 
E) Trend Analysis 
A) Liquidity Ratio 
B) Leverage Ratio 
C) Profitability Ratio 
D) Horizontal Analysis 
E) Trend Analysis

Question 18

All debt is considered in the computation of the quick ratio.

Accepted Answer

A) True 
 B)False

Question 19

Indicate the type of each ratio listed below.
-Inventory turnover ratio

Accepted Answer

A) Liquidity Ratio 
B) Leverage Ratio 
C) Profitability Ratio 
A) Liquidity Ratio 
B) Leverage Ratio 
C) Profitability Ratio

Question 20

Jackson Company, a retailer, had cost of goods sold of $140,000 last year.The beginning inventory balance was $8,000 and the ending inventory balance was $11,000.The company's inventory turnover ratio was closest to

Accepted Answer

A)  12.73. 
B)  14.74. 
C)  7.37. 
D)  17.50. 
A)  12.73. 
B)  14.74. 
C)  7.37. 
D)  17.50.

Horizontal analysis is analysis

Small sample sizes for an industrial report rarely cause a comparability problem in using standards.

In the vertical analysis of a balance sheet, the base for current liabilities is total liabilities.

Select the ratio that each statement below most properly satisfies. -A measure of the degree of protection afforded creditors in case of insolvency

Select the ratio that each statement below most properly satisfies. -A measure that tells an investor the proportion of earnings that a company pays in dividends

Which of the following types of analysis is useful in computing the relationships among the components of the financial statements for the same period?

The _________________ uses the income statement to assess a company's ability to service its debt.

Ruby Company's net income was $100,000 last year.The company has 25,000 shares of common stock and 6,000 shares of $50 par value, 6% preferred stock outstanding.There was no change in the number of common or preferred shares outstanding during the year.The earnings per share of common stock was:

Common-size analysis expresses each item in a financial statement as a percent of a base amount.

Which of the following ratios is used by short-term creditors to assess the debt-paying ability of a company?

Nickel Store had net credit sales of $15,000,000 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 $875,000 and $375,000 respectively.The accounts receivable turnover ratio was:

Match the classifications of ratios with each description. -Measures the degree of protection provided to company creditors

Common-size statements are statements of companies of similar size and operations.

Which of the following formulas is used to calculate the inventory turnover ratio?

Which profitability ratio requires the use of earnings per share in its calculation?

Match the classifications of ratios with each description. -Measures the earning ability of a company

All debt is considered in the computation of the quick ratio.

Indicate the type of each ratio listed below. -Inventory turnover ratio

Jackson Company, a retailer, had cost of goods sold of $140,000 last year.The beginning inventory balance was $8,000 and the ending inventory balance was $11,000.The company's inventory turnover ratio was closest to

Introduction to Managerial Accounting

Basic Managerial Accounting Concepts

Cost Behavior, Cost Forecasting, and Segmented Income Statements

Job-Order Costing and Normal Cost Overhead Application

Activity-Based Costing and Management

Process Costing

Cost-Volume-Profit Analysis

Tactical Decision-Making and Relevant Costing

Profit Planning and Flexible Budgets

Standard Costing and Variance Analysis

Performance Evaluation and Decentralization

Capital Investment Decisions

Emerging Topics in Managerial Accounting: Sustainability, Quality Cost, Lean Accounting, International Issues, Enterprise Risk Management, the Managerial Accountant in Forensicfraud Accounting

Statement of Cash Flows

Filters

Exam 15: Financial Statement Analysis

Horizontal analysis is analysis

Small sample sizes for an industrial report rarely cause a comparability problem in using standards.

In the vertical analysis of a balance sheet, the base for current liabilities is total liabilities.

Select the ratio that each statement below most properly satisfies. -A measure of the degree of protection afforded creditors in case of insolvency

Select the ratio that each statement below most properly satisfies. -A measure that tells an investor the proportion of earnings that a company pays in dividends

Which of the following types of analysis is useful in computing the relationships among the components of the financial statements for the same period?

The _________________ uses the income statement to assess a company's ability to service its debt.

Ruby Company's net income was $100,000 last year.The company has 25,000 shares of common stock and 6,000 shares of $50 par value, 6% preferred stock outstanding.There was no change in the number of common or preferred shares outstanding during the year.The earnings per share of common stock was:

Common-size analysis expresses each item in a financial statement as a percent of a base amount.

Which of the following ratios is used by short-term creditors to assess the debt-paying ability of a company?

Nickel Store had net credit sales of $15,000,000 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 $875,000 and $375,000 respectively.The accounts receivable turnover ratio was:

Match the classifications of ratios with each description. -Measures the degree of protection provided to company creditors

Common-size statements are statements of companies of similar size and operations.

Which of the following formulas is used to calculate the inventory turnover ratio?

Which profitability ratio requires the use of earnings per share in its calculation?

Match the classifications of ratios with each description. -Measures the earning ability of a company

All debt is considered in the computation of the quick ratio.

Indicate the type of each ratio listed below. -Inventory turnover ratio

Jackson Company, a retailer, had cost of goods sold of $140,000 last year.The beginning inventory balance was $8,000 and the ending inventory balance was $11,000.The company's inventory turnover ratio was closest to

Introduction to Managerial Accounting

Basic Managerial Accounting Concepts

Cost Behavior, Cost Forecasting, and Segmented Income Statements

Job-Order Costing and Normal Cost Overhead Application

Activity-Based Costing and Management

Process Costing

Cost-Volume-Profit Analysis

Tactical Decision-Making and Relevant Costing

Profit Planning and Flexible Budgets

Standard Costing and Variance Analysis

Performance Evaluation and Decentralization

Capital Investment Decisions

Emerging Topics in Managerial Accounting: Sustainability, Quality Cost, Lean Accounting, International Issues, Enterprise Risk Management, the Managerial Accountant in Forensicfraud Accounting

Statement of Cash Flows

Filters