Question 1

Which of the following statements is true?

Accepted Answer

A) The return on assets ratio indicates whether the company can pay its current debt when it becomes due. 
B) The causes for an increase or decrease in the return on assets ratio can be examined by calculating its two components: return on sales and asset turnover. 
C) If a company successfully applies leverage,its return on assets ratio will be greater than its return on common stockholders' equity ratio. 
D) If a company's return on assets ratio increases,the increase can be the result of decreased liquidity. 
A) The return on assets ratio indicates whether the company can pay its current debt when it becomes due. 
B) The causes for an increase or decrease in the return on assets ratio can be examined by calculating its two components: return on sales and asset turnover. 
C) If a company successfully applies leverage,its return on assets ratio will be greater than its return on common stockholders' equity ratio. 
D) If a company's return on assets ratio increases,the increase can be the result of decreased liquidity.

Question 2

The acid-test ratio is a stricter test of a company's ability to pay its current debts as they are due than the current ratio is.

Accepted Answer

A) True 
 B)False

Question 3

St.Petersburg Corporation
Use the information obtained from the comparative financial statements included in the St.Petersburg Corporation's 2012 annual report that is presented below to answer the questions that follow.All amounts are in thousands of dollars.
   Refer to the financial information for St.Petersburg Corporation.
REQUIRED:
Calculate the earnings per share for St.Petersburg for 2012 and 2011 assuming an average of 100,000 common shares were outstanding during 2012 and an average of 80,000 common shares were outstanding during 2011.Explain the change as it probably relates to the market value of the stock.

Accepted Answer

(Net income - Preferred dividends)/Weigh

Question 4

The following information was summarized from the balance sheets of the Better Books and Tenacious Texts at December 31,2012:
(in millions)

Accepted Answer

Better Books Tenacio

Question 5

Treetop Company paid off a $100,000 two-year note payable.The effect of this transaction is that the

Accepted Answer

A) earnings per share increased 
B) current ratio decreased 
C) debt-to-equity ratio increased 
D) debt-to-equity ratio decreased 
A) earnings per share increased 
B) current ratio decreased 
C) debt-to-equity ratio increased 
D) debt-to-equity ratio decreased

Question 6

The current ratio

Accepted Answer

A) is generally smaller than the quick ratio. 
B) decreases when a company becomes more liquid. 
C) increases when a company allows more customers to charge on account instead of collecting cash. 
D) is larger when a company is more liquid. 
A) is generally smaller than the quick ratio. 
B) decreases when a company becomes more liquid. 
C) increases when a company allows more customers to charge on account instead of collecting cash. 
D) is larger when a company is more liquid.

Question 7

The acid-test ratio differs from the current ratio in that it

Accepted Answer

A) represents the amount of cash on hand instead of the amount of working capital. 
B) excludes inventories and accounts receivable from the numerator of the fraction because of obsolescence and possible nonpayment. 
C) is a stricter test of a company's ability to pay its current debts as they are due 
D) signals the need to liquidate marketable securities when it drops below 5 to 1. 
A) represents the amount of cash on hand instead of the amount of working capital. 
B) excludes inventories and accounts receivable from the numerator of the fraction because of obsolescence and possible nonpayment. 
C) is a stricter test of a company's ability to pay its current debts as they are due 
D) signals the need to liquidate marketable securities when it drops below 5 to 1.

Question 8

The dollar change and percentage change in the accounts receivable account from 2013 to 2014 is calculated for Allison Corporation.This is an example of

Accepted Answer

A) horizontal analysis 
B) vertical analysis 
C) profitability analysis 
D) solvency assessment 
A) horizontal analysis 
B) vertical analysis 
C) profitability analysis 
D) solvency assessment

Question 9

What are three specific ratios that are especially useful for creditors and lenders?

Accepted Answer

Current ratio
Acid-test ratio

Question 10

Use the current asset section of the balance sheets of the Breeze Company as of June 30,2012 and 2011 presented below to answer the questions that follow.

Accepted Answer

REQUIRED:
In the spaces provided below,c

Question 11

Which of the following profitability ratios is most useful in indicating the "quality" of a company's earnings?

Accepted Answer

A) Price/earnings ratio 
B) Gross profit ratio 
C) Dividend payout ratio 
D) Dividend yield ratio 
A) Price/earnings ratio 
B) Gross profit ratio 
C) Dividend payout ratio 
D) Dividend yield ratio

Question 12

If Crab Shack Company has a current ratio of 2.5 and current assets of $195,000,the amount of working capital is:

Accepted Answer

A) $117,000 
B) $330,000 
C) $380,000 
D) $78,000 
A) $117,000 
B) $330,000 
C) $380,000 
D) $78,000

Question 13

Horizontal analysis is analysis

Accepted Answer

A) of dollar changes and 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 dollar changes and 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 14

Spring Market has an inventory turnover ratio of 15 times.Fall Market has a turnover of 14 times.Fall is more effective in managing inventory.

Accepted Answer

A) True 
 B)False

Question 15

Which of the following is the most serious limitation to financial statement analysis of publicly traded companies?

Accepted Answer

A) Some companies don't use GAAP. 
B) Inflation can distort comparisons between years. 
C) Some companies report nonoperating items such as extraordinary gains and losses,while others do not. 
D) Different industries use different account names. 
A) Some companies don't use GAAP. 
B) Inflation can distort comparisons between years. 
C) Some companies report nonoperating items such as extraordinary gains and losses,while others do not. 
D) Different industries use different account names.

Question 16

Given below are three ratios calculated for Lantana,Tera,and Bake Companies for 2012 and 2011.

Accepted Answer

The answer of Given below are three ratios calculated for...

Question 17

Culinary Delights Company

Accepted Answer

@#IMG-DLM& Refer to the financial statements of Cu

Question 18

Ratios that focus on cash are more useful than those that focus on income in the evaluation of the liquidity of a company.

Accepted Answer

A) True 
 B)False

Question 19

To review the current market price of the stock,one should review the

Accepted Answer

A) balance sheet. 
B) income statement. 
C) statement of cash flows. 
D) none of these;it is not on the financial statements. 
A) balance sheet. 
B) income statement. 
C) statement of cash flows. 
D) none of these;it is not on the financial statements.

Question 20

The denominator of a return ratio will be some measure of the company's income for the period.

Accepted Answer

A) True 
 B)False

Which of the following statements is true?

The acid-test ratio is a stricter test of a company's ability to pay its current debts as they are due than the current ratio is.

The following information was summarized from the balance sheets of the Better Books and Tenacious Texts at December 31,2012: (in millions)

Treetop Company paid off a $100,000 two-year note payable.The effect of this transaction is that the

The current ratio

The acid-test ratio differs from the current ratio in that it

The dollar change and percentage change in the accounts receivable account from 2013 to 2014 is calculated for Allison Corporation.This is an example of

What are three specific ratios that are especially useful for creditors and lenders?

Use the current asset section of the balance sheets of the Breeze Company as of June 30,2012 and 2011 presented below to answer the questions that follow.

Which of the following profitability ratios is most useful in indicating the "quality" of a company's earnings?

If Crab Shack Company has a current ratio of 2.5 and current assets of $195,000,the amount of working capital is:

Horizontal analysis is analysis

Spring Market has an inventory turnover ratio of 15 times.Fall Market has a turnover of 14 times.Fall is more effective in managing inventory.

Which of the following is the most serious limitation to financial statement analysis of publicly traded companies?

Given below are three ratios calculated for Lantana,Tera,and Bake Companies for 2012 and 2011.

Culinary Delights Company

Ratios that focus on cash are more useful than those that focus on income in the evaluation of the liquidity of a company.

To review the current market price of the stock,one should review the

The denominator of a return ratio will be some measure of the company's income for the period.

Accounting As a Form of Communication

Financial Statements and the Annual Report

Processing Accounting Information

Income Measurement and Accrual Accounting

Inventories and Cost of Goods Sold

Cash and Internal Control

Receivables and Investments

Operating Assets: Property, plant, and Equipment, and Intangibles

Current Liabilities, contingencies, and the Time Value of Money

Long-Term Liabilities

Stockholders Equity

The Statement of Cash Flows

International Financial Reporting Standards

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Exam 13: Financial Statement Analysis

Which of the following statements is true?

The acid-test ratio is a stricter test of a company's ability to pay its current debts as they are due than the current ratio is.

The following information was summarized from the balance sheets of the Better Books and Tenacious Texts at December 31,2012: (in millions)

Treetop Company paid off a $100,000 two-year note payable.The effect of this transaction is that the

The current ratio

The acid-test ratio differs from the current ratio in that it

The dollar change and percentage change in the accounts receivable account from 2013 to 2014 is calculated for Allison Corporation.This is an example of

What are three specific ratios that are especially useful for creditors and lenders?

Use the current asset section of the balance sheets of the Breeze Company as of June 30,2012 and 2011 presented below to answer the questions that follow.

Which of the following profitability ratios is most useful in indicating the "quality" of a company's earnings?

If Crab Shack Company has a current ratio of 2.5 and current assets of $195,000,the amount of working capital is:

Horizontal analysis is analysis

Spring Market has an inventory turnover ratio of 15 times.Fall Market has a turnover of 14 times.Fall is more effective in managing inventory.

Which of the following is the most serious limitation to financial statement analysis of publicly traded companies?

Given below are three ratios calculated for Lantana,Tera,and Bake Companies for 2012 and 2011.

Culinary Delights Company

Ratios that focus on cash are more useful than those that focus on income in the evaluation of the liquidity of a company.

To review the current market price of the stock,one should review the

The denominator of a return ratio will be some measure of the company's income for the period.

Accounting As a Form of Communication

Financial Statements and the Annual Report

Processing Accounting Information

Income Measurement and Accrual Accounting

Inventories and Cost of Goods Sold

Cash and Internal Control

Receivables and Investments

Operating Assets: Property, plant, and Equipment, and Intangibles

Current Liabilities, contingencies, and the Time Value of Money

Long-Term Liabilities

Stockholders Equity

The Statement of Cash Flows

International Financial Reporting Standards

Filters