Hsu Company reported the following on its income statement:?? \[\begin{array} { l r } \text { Income before income taxes } & \$ 420,000 \\ \text { Income tax expense } & 120,000 \\ \text { Net income } & \mathbf { \$ 30 0 , 0 0 0 } \end{array}\] Interest expense was $80,000. Hsu Company's times interest earned ratio is

A) 8 times B) 6.25 times C) 5.25 times D) 5 times A) 8 times B) 6.25 times C) 5.25 times D) 5 times

The following data are taken from the balance sheet at the end of the current year:?? \[\begin{array} { l r } \text { Cash } & \$ 154,000 \\ \text { Accounts receivable } & 210,000 \\ \text { Inventory } & 240,000 \\ \text { Prepaid expenses } & 15,000 \\ \text { Temporary investments } & 350,000 \\ \text { Property, plant, and equipment } & 375,000 \\ \text { Accounts payable } & 245,000 \\ \text { Accrued liabilities } & 4,000 \\ \text { Income tax payable } & 10,000 \\ \text { Notes payable, short-term } & 85,000 \end{array}\] Determine the (a) working capital, (b) current ratio, and (c) quick ratio. Round ratios to one decimal place.

(a)Current Assets ($969,000) - Current

Exam 17: Financial Statement Analysis

Assuming that the quantities of inventory on hand during the current year were sufficient to meet all demands for sales, a decrease in the inventory turnover for the current year when compared with the turnover for the preceding year indicates an improvement in inventory management.

(True/False)

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Question 121

The following information was taken from the financial statement of Fox Resources for December 31 of the current fiscal year:?Common stock, $20 par value (no change during the year)$5,000,000Preferred 10% stock, $40 par (no change during the year)2,000,000?The net income was $600,000, and the declared dividends on the common stock were $125,000 for the current year. The market price of the common stock is $20 per share.Calculate for the common stock: (a) Earnings per share (b) Price-earnings ratio (c) Dividends per share and dividend yield?Round to one decimal place except earnings per share, which should be rounded to two decimal places.

(Essay)

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Question 122

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

(Multiple Choice)

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Question 123

The following information pertains to Dallas Company. Assume that all balance sheet amounts represent both average and ending balance figures and that all sales were on credit. What is the return on stockholders' equity?

(Multiple Choice)

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Question 124

The purpose of an audit is to

(Multiple Choice)

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Question 125

Comparing dividends per share to earnings per share indicates the extent to which the corporation is retaining its earnings for use in operations.

(True/False)

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Question 126

Define solvency and profitability. How are they alike?

(Essay)

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Question 127

Hsu Company reported the following on its income statement:?? Income before income taxes \ 420,000 Income tax expense 120,000 Net income Interest expense was $80,000. Hsu Company's times interest earned ratio is

(Multiple Choice)

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Question 128

Match each ratio that follows to its use (items a-h). Items may be used more than once. -Return on total assets

(Multiple Choice)

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Question 129

Percentage analyses, ratios, turnovers, and other measures of financial position and operating results are

(Multiple Choice)

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Question 130

Using measures to assess a business's ability to pay its current liabilities is called current position analysis.

(True/False)

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Question 131

Which of the following is required by the Sarbanes-Oxley Act?

(Multiple Choice)

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Question 132

The following information pertains to Diane Company. Assume that all balance sheet amounts represent both average and ending balance figures and that all sales were on credit. Use this information to answer the questions that follow. -Using the data provided for Diane Company, what is the asset turnover?

(Multiple Choice)

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Question 133

The following data are taken from the balance sheet at the end of the current year:?? Cash \ 154,000 Accounts receivable 210,000 Inventory 240,000 Prepaid expenses 15,000 Temporary investments 350,000 Property, plant, and equipment 375,000 Accounts payable 245,000 Accrued liabilities 4,000 Income tax payable 10,000 Notes payable, short-term 85,000 Determine the (a) working capital, (b) current ratio, and (c) quick ratio. Round ratios to one decimal place.

(Essay)

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Question 134

The following information has been condensed from the December 31 balance sheets of Gabriel Co.:? (a)Determine the ratio of fixed assets to long-term liabilities for each year. (b)Determine the ratio of liabilities to stockholders' equity for each year. (c)Comment on the year-to-year changes for both ratios.?Round your answers to two decimal places.

(Essay)

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Question 135

Which of the following items should be classified as an unusual item on an income statement?

(Multiple Choice)

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Question 136

Factors that reflect the ability of a business to pay its debts and earn a reasonable amount of income are referred to as solvency, profitability, and liquidity.

(True/False)

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Question 137

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

(Multiple Choice)

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Question 138

The effects of differences in accounting methods are of little importance when analyzing comparable data from competing businesses.

(True/False)

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Question 139

A company can compare its financial data to the data of other companies and industry averages to evaluate its position.

(True/False)

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Question 140

Showing 121 - 140 of 201

Exam 17: Financial Statement Analysis

Assuming that the quantities of inventory on hand during the current year were sufficient to meet all demands for sales, a decrease in the inventory turnover for the current year when compared with the turnover for the preceding year indicates an improvement in inventory management.

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

The following information pertains to Dallas Company. Assume that all balance sheet amounts represent both average and ending balance figures and that all sales were on credit.​​ What is the return on stockholders' equity?

The purpose of an audit is to

Comparing dividends per share to earnings per share indicates the extent to which the corporation is retaining its earnings for use in operations.

Define solvency and profitability. How are they alike?

Hsu Company reported the following on its income statement:?? Income before income taxes \ 420,000 Income tax expense 120,000 Net income Interest expense was $80,000. Hsu Company's times interest earned ratio is

Match each ratio that follows to its use (items a-h). Items may be used more than once. -Return on total assets

Percentage analyses, ratios, turnovers, and other measures of financial position and operating results are

Using measures to assess a business's ability to pay its current liabilities is called current position analysis.

Which of the following is required by the Sarbanes-Oxley Act?

Which of the following items should be classified as an unusual item on an income statement?

Factors that reflect the ability of a business to pay its debts and earn a reasonable amount of income are referred to as solvency, profitability, and liquidity.

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

The effects of differences in accounting methods are of little importance when analyzing comparable data from competing businesses.

A company can compare its financial data to the data of other companies and industry averages to evaluate its position.

Introduction to Accounting and Business

Analyzing Transactions

The Adjusting Process

Completing the Accounting Cycle

Accounting Systems

Accounting for Merchandising Businesses

Inventories

Internal Control and Cash

Receivables

Long-Term Assets: Fixed and Intangible

Current Liabilities and Payroll

Accounting for Partnerships and Limited Liability Companies

Corporations: Organization, Stock Transactions, and Dividends

Long-Term Liabilities: Bonds and Notes

Investments and Fair Value Accounting

Statement of Cash Flows

Introduction to Managerial Accounting

Job Order Costing

Process Cost Systems

Cost-Volume-Profit Analysis

Evaluating Variances From Standard Costs

Decentralized Operations

Differential Analysis, Product Pricing, and Activity-Based Costing

Capital Investment Analysis

Filters

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

The following information pertains to Dallas Company. Assume that all balance sheet amounts represent both average and ending balance figures and that all sales were on credit. What is the return on stockholders' equity?