Exam 9: Financial Statement Analysis

Condensed data taken from the ledger of Crawford Company at December 31,2011 and 2010,are as follows: Prepare a comparative balance sheet,with horizontal analysis,for December 31,2011 and 2010.(Round percents to one decimal place. )

Which of the following ratios provides a solvency measure that shows the margin of safety of noteholders or bondholders and also gives an indication of the potential ability of the business to borrow additional funds on a long-term basis?

If the accounts receivable turnover for the current year has decreased when compared with the ratio for the preceding year,there has been an acceleration in the collection of receivables.

Based on the following data for the current year,what is the number of days' sales in inventory (rounded to the nearest whole day)?

Based on the following data,what is the amount of quick assets?

A company with $60,000 in current assets and $40,000 in current liabilities pays a $1,000 current liability.As a result of this transaction,the current ratio and working capital will

Which one of the following is NOT a characteristic generally evaluated in ratio analysis?

Based on the following data,what is the quick ratio,rounded to one decimal place?

Based on the following data for the current year,what is the inventory turnover?

The comparison of the financial data of a single company for two or more years is called horizontal analysis.

The following information is available for Morgan Corp.: Which of the following statements is correct?

Using vertical analysis of the income statement,a company's net income as a percentage of net sales is 10%;therefore,the operating expenses as a percentage of sales must be 90%.

Thomson Company reported the following on its income statement: An analysis of the income statement revealed that interest expense was $40,000.Thomson Company's number of times interest charges are earned was

Based on the following data for the current year,what is the number of days' sales in accounts receivable?

The number of days' sales in inventory is one means of expressing the relationship between net sales and accounts receivable.

The ability of a business to pay its debts as they come due and to earn a reasonable amount of income is referred to as

Which additional report is required of independent auditors since the passage of the Sarbanes-Oxley Act in 2002?

Profitability refers to the ability of the business to

The ratio of current assets to current liabilities is referred to as the acid-test ratio.

The percent of fixed assets to total assets is an example of