The following selected financial data pertain to four companies: a hotel, a travel agency, a meat packing company and a pharmaceutical company. Required: Match each with the financial information and explain why you made your choice as you did. \(\begin{array}{c} \begin{array}{|l|} \hline \text {Balance Sleet Data}\\ \text {(conmonent percentages)}\\ \hline \text {Cash}\\ \hline \text {Accounts Receivable}\\ \hline \text {Inventory}\\ \hline \text {Property, Plant \& Equipment}\\ \hline \\ \hline \text {Income Statement Data}\\ \text {(conmonent percentages)}\\ \hline \text {GrossProfit}\\ \hline \text {Profit before Taxes}\\ \hline \\ \hline \text {Ratios}\\ \hline \text {Current ratio (over the last five years)}\\ \hline \text {Inventory turnover ratio}\\ \hline \text {Debt-to-equity ratio}\\ \hline \end{array} \begin{array}{l|} \hline\text {Company}\\ \mathbf{1} \\ \hline 7.2 \\ \hline 28.0 \\ \hline 21.4 \\ \hline 32.0\\ \hline\\ \hline\\ \\ \hline 15.2 \\ \hline 1.8 \\ \hline\\ \hline\\ \hline 1.6 \\ \hline 27.8 \\ \hline 1.8 \\ \hline \end{array} \begin{array}{l|} \hline\text {Company}\\ \mathbf{2} \\ \hline 22.0 \\ \hline 40.0 \\ \hline 0.5 \\ \hline 19.0 \\ \hline \\ \hline \\ \\ \hline \text { Not Applicable } \\ \hline 3.3 \\ \hline \\ \hline \\ \hline 1.3 \\ \hline \text { Not Applicable } \\ \hline 2.3 \\ \hline \end{array} \begin{array}{l|} \hline\text {Company 3}\\ \\ \hline6.0 \\ \hline3.4 \\ \hline0.9 \\ \hline75.1\\ \hline\\ \hline\\ \\ \hline\text {Not Applicable}\\ \hline2.5\\ \hline\\ \hline\\ \hline0.5\\ \hline\text {Not Applicable}\\ \hline5.8\\ \hline \end{array} \begin{array}{l|} \hline\text {Company 4}\\ \\ \hline11.2\\ \hline23.0 \\ \hline 27.4 \\ \hline 25.0\\ \hline\\ \hline\\ \\ \hline44.0\\ \hline7.0\\ \hline\\ \hline\\ \hline1.8\\ \hline3.4\\ \hline1.4\\ \hline \end{array} \end{array}\)

Company 1: Meat packing company (high in

Exam 1: Overview of Financial Reporting, Financial Statement Analysis, and Valuation

Which of the following is an independent entity comprising 15 members and a full-time professional staff that specifies acceptable accounting principles known as the IFRS?

(Multiple Choice)

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Question 61

On a common size basis, which of the following assets is normally largest for a electric utility?

(Multiple Choice)

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Question 62

Most financial statement analysis aims to assess a firm's and .

(Short Answer)

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Question 63

All of the following are the building blocks for financial statement analysis except:

(Multiple Choice)

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Question 64

Which of the following is not an activity reported in the cash flows financial statement?

(Multiple Choice)

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Question 65

When identifying the strategies that a particular firm pursues to gain a competitive advantage it is important to determine if its products are designed to meet the needs of a specific market segment or are they intended for a _____________________________________________.

(Short Answer)

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Question 66

___________________________________ equals net income for a period plus or minus the changes in shareholders' equity accounts other than from net income and transactions with owners.

(Short Answer)

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Question 67

The first step in financial statement analysis is to identify the __________________________________________________ of the industry in which a firm participates.

(Short Answer)

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Question 68

Which forces typically represent horizontal competition in a value chain?

(Multiple Choice)

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Question 69

Extraordinary gains and losses arise from events that have all the following characteristics except:

(Multiple Choice)

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Question 70

An example of an intangible asset is

(Multiple Choice)

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Question 71

All of the following are reasons that pharmaceutical companies have higher barriers for entry than grocery stores except:

(Multiple Choice)

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Question 72

Which of the following activities reported in the Statement of Cash Flows is not a financing activity?

(Multiple Choice)

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Question 73

What three financial statements are prepared by business firms and what information does each provide?

(Essay)

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Question 74

___________________________________ financial statements are helpful in highlighting the relative magnitude of changes in financial statement data from year to year.

(Short Answer)

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Question 75

The primary purpose of the balance sheet is to:

(Multiple Choice)

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Question 76

The following selected financial data pertain to four companies: a hotel, a travel agency, a meat packing company and a pharmaceutical company. Required: Match each with the financial information and explain why you made your choice as you did. Balance Sleet Data (conmonent percentages) Cash Accounts Receivable Inventory Property, Plant \& Equipment Income Statement Data (conmonent percentages) GrossProfit Profit before Taxes Ratios Current ratio (over the last five years) Inventory turnover ratio Debt-to-equity ratio Company 7.2 28.0 21.4 32.0 15.2 1.8 1.6 27.8 1.8 Company 22.0 40.0 0.5 19.0 Not Applicable 3.3 1.3 Not Applicable 2.3 Company 3 6.0 3.4 0.9 75.1 Not Applicable 2.5 0.5 Not Applicable 5.8 Company 4 11.2 23.0 27.4 25.0 44.0 7.0 1.8 3.4 1.4

(Essay)

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Question 77

Which of the following economic characteristics is consistent with a pharmaceutical company?

(Multiple Choice)

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Question 78

Net income is equal to:

(Multiple Choice)

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Question 79

Which of the following is not an expense of a business?

(Multiple Choice)

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Question 80

Which of the following is an independent entity comprising 15 members and a full-time professional staff that specifies acceptable accounting principles known as the IFRS?

On a common size basis, which of the following assets is normally largest for a electric utility?

Most financial statement analysis aims to assess a firm's and .

All of the following are the building blocks for financial statement analysis except:

Which of the following is not an activity reported in the cash flows financial statement?

When identifying the strategies that a particular firm pursues to gain a competitive advantage it is important to determine if its products are designed to meet the needs of a specific market segment or are they intended for a _____________________________________________.

___________________________________ equals net income for a period plus or minus the changes in shareholders' equity accounts other than from net income and transactions with owners.

The first step in financial statement analysis is to identify the __________________________________________________ of the industry in which a firm participates.

Which forces typically represent horizontal competition in a value chain?

Extraordinary gains and losses arise from events that have all the following characteristics except:

An example of an intangible asset is

All of the following are reasons that pharmaceutical companies have higher barriers for entry than grocery stores except:

Which of the following activities reported in the Statement of Cash Flows is not a financing activity?

What three financial statements are prepared by business firms and what information does each provide?

___________________________________ financial statements are helpful in highlighting the relative magnitude of changes in financial statement data from year to year.

The primary purpose of the balance sheet is to:

Which of the following economic characteristics is consistent with a pharmaceutical company?

Net income is equal to:

Which of the following is not an expense of a business?

Asset and Liability Valuation and Income Measurement

Income Flows Versus Cash Flows: Understanding the Statement of Cash Flows

Profitability Analysis

Risk Analysis

Financing Activities

Investing Activities

Operating Activities

Accounting Quality

Forecasting Financial Statements

Risk-Adjusted Expected Rates of Return and the Dividends Valuation Approach

Valuation: Cash-Flow-Based Approaches

Valuation: Earnings-Based Approaches

Valuation: Market-Based Approaches

Filters

Exam 1: Overview of Financial Reporting, Financial Statement Analysis, and Valuation

Which of the following is an independent entity comprising 15 members and a full-time professional staff that specifies acceptable accounting principles known as the IFRS?

On a common size basis, which of the following assets is normally largest for a electric utility?

Most financial statement analysis aims to assess a firm's ____________________ and ____________________.

All of the following are the building blocks for financial statement analysis except:

Which of the following is not an activity reported in the cash flows financial statement?

When identifying the strategies that a particular firm pursues to gain a competitive advantage it is important to determine if its products are designed to meet the needs of a specific market segment or are they intended for a _____________________________________________.

___________________________________ equals net income for a period plus or minus the changes in shareholders' equity accounts other than from net income and transactions with owners.

The first step in financial statement analysis is to identify the __________________________________________________ of the industry in which a firm participates.

Which forces typically represent horizontal competition in a value chain?

Extraordinary gains and losses arise from events that have all the following characteristics except:

An example of an intangible asset is

All of the following are reasons that pharmaceutical companies have higher barriers for entry than grocery stores except:

Which of the following activities reported in the Statement of Cash Flows is not a financing activity?

What three financial statements are prepared by business firms and what information does each provide?

___________________________________ financial statements are helpful in highlighting the relative magnitude of changes in financial statement data from year to year.

The primary purpose of the balance sheet is to:

Which of the following economic characteristics is consistent with a pharmaceutical company?

Net income is equal to:

Which of the following is not an expense of a business?

Asset and Liability Valuation and Income Measurement

Income Flows Versus Cash Flows: Understanding the Statement of Cash Flows

Profitability Analysis

Risk Analysis

Financing Activities

Investing Activities

Operating Activities

Accounting Quality

Forecasting Financial Statements

Risk-Adjusted Expected Rates of Return and the Dividends Valuation Approach

Valuation: Cash-Flow-Based Approaches

Valuation: Earnings-Based Approaches

Valuation: Market-Based Approaches

Filters

Most financial statement analysis aims to assess a firm's and .