Question 1

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

Accepted Answer

A)  liquidity 
B)  profitability 
C)  solvency 
D)  marketability 
A)  liquidity 
B)  profitability 
C)  solvency 
D)  marketability D

Question 2

The following information pertains to Brock Company. Assume that all balance sheet amounts represent both average and ending balance figures. Assume that all sales were on credit. Assets

What is the current ratio for this company?

Accepted Answer

A)  1.42 
B)  0.78 
C)  1.58 
D)  0.67 
A)  1.42 
B)  0.78 
C)  1.58 
D)  0.67 C

Question 3

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

Accepted Answer

A) True 
 B)False  False

Question 4

Based on the above data, what is the amount of working capital?

Accepted Answer

A)  $213,000 
B)  $113,000 
C)  $153,000 
D)  $39,000 
A)  $213,000 
B)  $113,000 
C)  $153,000 
D)  $39,000

Question 5

A company reports the following:
   Determine the ratio of net sales to total assets. Round your answer to one decimal place.

Accepted Answer

Ratio of net sales to total as

Question 6

Those unusual items reported as deductions from income from continuing operations should be listed net of the related income tax.

Accepted Answer

A) True 
 B)False

Question 7

Which of the following is considered an unusual item affecting the prior period's income statement?

Accepted Answer

A)  Change in accounting principles 
B)  Fixed asset impairments 
C)  Extraordinary item 
D)  Discontinued operations 
A)  Change in accounting principles 
B)  Fixed asset impairments 
C)  Extraordinary item 
D)  Discontinued operations

Question 8

From the following data for Norton Company for the year ended December 31, 2012 prepare a multiple-step income statement. Show parenthetically earnings per share for the following: income from continuing operations, loss on discontinued operations (less applicable income tax), income before extraordinary item, extraordinary item (less applicable income tax), and net income.

Accepted Answer

The answer of From the following data for Norton Company...

Question 9

A company reports the following:
   Determine the (a) inventory turnover, and (b) number of days' sales in inventory. Round your answer to one decimal place.

Accepted Answer

The answer of A company reports the following:
  ...

Question 10

The following information has been condensed from the December 31 balance sheets of Hanson Co.:
     Round your answers to two decimal place.

Accepted Answer

The answer of The following information has been condensed from...

Question 11

Prepare an Income Statement using the following data for Young Adventures for the year ended December 31, 2012:

Accepted Answer

The answer of Prepare an Income Statement using the following...

Question 12

From the following data, determine for the current year the (a) rate earned on total assets, (b) rate earned on stockholders' equity, (c) rate earned on common stockholders' equity, (d) earnings per share on common stock, (e) price-earnings ratio on common stock, and (f) dividend yield on common stock. Assume that the current market price per share of common stock is $25. (Present key figures used in your computations.)
Round percentage values to one decimal place, dollar values to two decimal places, and other ratios to one decimal place.

Accepted Answer

The answer of From the following data, determine for the...

Question 13

The rate earned on total assets measures the profitability of total assets, without considering how the assets are financed.

Accepted Answer

A) True 
 B)False

Question 14

A company reports the following income statement and balance sheet information for the current year:
  
0 Determine the rate earned on total assets. Round your answer to one decimal place.

Accepted Answer

Rate earned on total assets = (Net incom

Question 15

A company reports the following:
   Determine the ratio of net sales to total assets. Round your answer to one decimal place.

Accepted Answer

Ratio of net sales to total as

Question 16

A company with $70,000 in current assets and $50,000 in current liabilities pays a $1,000 current liability. As a result of this transaction, the current ratio and working capital will

Accepted Answer

A)  both decrease. 
B)  both increase. 
C)  increase and remain the same, respectively. 
D)  remain the same and decrease, respectively. 
A)  both decrease. 
B)  both increase. 
C)  increase and remain the same, respectively. 
D)  remain the same and decrease, respectively.

Question 17

The following information pertains to Newman Company. Assume that all balance sheet amounts represent both average and ending balance figures. Assume that all sales were on credit.  
What is the rate earned on total assets for this company?

Accepted Answer

A)  8.1% 
B)  6.8% 
C)  10.5% 
D)  16.1% 
A)  8.1% 
B)  6.8% 
C)  10.5% 
D)  16.1%

Question 18

The relationship of each asset item as a percent of total assets is an example of vertical analysis.

Accepted Answer

A) True 
 B)False

Question 19

Which of the following below generally is the most useful in analyzing companies of different sizes

Accepted Answer

A)  comparative statements 
B)  common-sized financial statements 
C)  price-level accounting 
D)  audit report 
A)  comparative statements 
B)  common-sized financial statements 
C)  price-level accounting 
D)  audit report

Question 20

All of the following are typically included in the Management's Discussion and Analysis in annual reports except:

Accepted Answer

A)  explanations of any significant changes between the current and prior years' financial statements. 
B)  management's assessment of liquidity. 
C)  journal entries. 
D)  off-balance-sheet arrangements 
A)  explanations of any significant changes between the current and prior years' financial statements. 
B)  management's assessment of liquidity. 
C)  journal entries. 
D)  off-balance-sheet arrangements

Exam 15: Financial Statement Analysis

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

The following information pertains to Brock Company. Assume that all balance sheet amounts represent both average and ending balance figures. Assume that all sales were on credit. Assets What is the current ratio for this company?

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

Based on the above data, what is the amount of working capital?

A company reports the following: Determine the ratio of net sales to total assets. Round your answer to one decimal place.

Those unusual items reported as deductions from income from continuing operations should be listed net of the related income tax.

Which of the following is considered an unusual item affecting the prior period's income statement?

A company reports the following: Determine the (a) inventory turnover, and (b) number of days' sales in inventory. Round your answer to one decimal place.

The following information has been condensed from the December 31 balance sheets of Hanson Co.: Round your answers to two decimal place.

Prepare an Income Statement using the following data for Young Adventures for the year ended December 31, 2012:

The rate earned on total assets measures the profitability of total assets, without considering how the assets are financed.

A company reports the following income statement and balance sheet information for the current year: 0 Determine the rate earned on total assets. Round your answer to one decimal place.

A company reports the following: Determine the ratio of net sales to total assets. Round your answer to one decimal place.

A company with $70,000 in current assets and $50,000 in current liabilities pays a $1,000 current liability. As a result of this transaction, the current ratio and working capital will

The following information pertains to Newman Company. Assume that all balance sheet amounts represent both average and ending balance figures. Assume that all sales were on credit. What is the rate earned on total assets for this company?

The relationship of each asset item as a percent of total assets is an example of vertical analysis.

Which of the following below generally is the most useful in analyzing companies of different sizes

All of the following are typically included in the Management's Discussion and Analysis in annual reports except:

Introduction to Accounting and Business

Analyzing Transactions

The Adjusting Process

Completing the Accounting Cycle

Accounting for Merchandising Businesses

Inventories

Sarbanes-Oxley, Internal Control, and Cash

Receivables

Fixed Assets and Intangible Assets

Current Liabilities and Payroll

Corporations: Organization, Stock Transactions, and Dividends

Long-Term Liabilities: Bonds and Notes

Investments and Fair Value Accounting

Statement of Cash Flows

Managerial Accounting Concepts and Principles

Job Order Costing

Process Cost Systems

Cost Behavior and Cost-Volume-Profit Analysis

Variable Costing for Management Analysis

Budgeting

Performance Evaluation Using Variances From Standard Costs

Performance Evaluation for Decentralized Operations

Differential Analysis and Product Pricing

Capital Investment Analysis

Cost Allocation and Activity-Based Costing

Cost Management for Just-In-Time Environments

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