Question 1

Affluent Limited reported the following on its statement of income:   Interest expense was $150,000.Gifford's times interest earned was

Accepted Answer

A) 9 times. 
B) 8 times. 
C) 6.5 times. 
D) 5.5 times. 
A) 9 times. 
B) 8 times. 
C) 6.5 times. 
D) 5.5 times.

Question 2

Comparisons of company data with industry averages provide information about a company's relative position within the industry.

Accepted Answer

A) True 
 B)False

Question 3

The gain (loss) on disposal of a discontinued operation is not reported on the statement of income.

Accepted Answer

A) True 
 B)False

Question 4

Which of the following solvency positions would a company consider most favourable?

Accepted Answer

A) a high debt to total assets ratio and a low times interest earned ratio 
B) a low debt to total assets ratio and a high times interest earned ratio 
C) a high debt to total assets ratio and a high times interest earned ratio 
D) a low debt to total assets ratio and a low times interest earned ratio 
A) a high debt to total assets ratio and a low times interest earned ratio 
B) a low debt to total assets ratio and a high times interest earned ratio 
C) a high debt to total assets ratio and a high times interest earned ratio 
D) a low debt to total assets ratio and a low times interest earned ratio

Question 5

The current ratio is

Accepted Answer

A) calculated by dividing current liabilities by current assets. 
B) used to evaluate a company's liquidity and short-term debt paying ability. 
C) used to evaluate a company's solvency and long-term debt paying ability. 
D) calculated by subtracting current liabilities from current assets. 
A) calculated by dividing current liabilities by current assets. 
B) used to evaluate a company's liquidity and short-term debt paying ability. 
C) used to evaluate a company's solvency and long-term debt paying ability. 
D) calculated by subtracting current liabilities from current assets.

Question 6

Use the following information to answer questions 
Green Thumb Garden Supplies reported the following information for 2021 and 2022:
  
-What is the profit margin for 2022?

Accepted Answer

A) 8.6% 
B) 10.0% 
C) 17.1% 
D) 31.6% 
A) 8.6% 
B) 10.0% 
C) 17.1% 
D) 31.6%

Question 7

The price-earnings ratio reflects investors' expectations about the future profitability of the company.

Accepted Answer

A) True 
 B)False

Question 8

The current ratio is a

Accepted Answer

A) liquidity ratio. 
B) profitability ratio. 
C) solvency ratio. 
D) cash flow ratio. 
A) liquidity ratio. 
B) profitability ratio. 
C) solvency ratio. 
D) cash flow ratio.

Question 9

Free cash flow is the cash available after a company pays dividends.

Accepted Answer

A) True 
 B)False

Question 10

Use the following information to answer questions 
Green Thumb Garden Supplies reported the following information for 2021 and 2022:
  
-What is the dividend yield for 2022?

Accepted Answer

A) 2.3% 
B) 4.4% 
C) 9.0% 
D) 12.5% 
A) 2.3% 
B) 4.4% 
C) 9.0% 
D) 12.5%

Question 11

A common measure of profitability is the

Accepted Answer

A) current ratio. 
B) free cash flow. 
C) return on common shareholders' equity ratio. 
D) debt to total assets ratio. 
A) current ratio. 
B) free cash flow. 
C) return on common shareholders' equity ratio. 
D) debt to total assets ratio.

Question 12

The return on assets ratio is affected by the

Accepted Answer

A) profit margin and debt to total assets ratios. 
B) profit margin and asset turnover ratios. 
C) times interest earned and debt to total assets ratios. 
D) profit margin and free cash flow. 
A) profit margin and debt to total assets ratios. 
B) profit margin and asset turnover ratios. 
C) times interest earned and debt to total assets ratios. 
D) profit margin and free cash flow.

Question 13

The first step in any comprehensive analysis is to perform a horizontal and vertical analysis.

Accepted Answer

A) True 
 B)False

Question 14

Which of the following is false about the dividend yield ratio?

Accepted Answer

A) High growth companies tend to have lower dividend yield ratios. 
B) It measures the rate of return a shareholder earned from dividends during the year. 
C) A low dividend yield, by itself, is neither bad nor good. 
D) Dividend yield ratio = Market price per share ÷ Dividends per share. 
A) High growth companies tend to have lower dividend yield ratios. 
B) It measures the rate of return a shareholder earned from dividends during the year. 
C) A low dividend yield, by itself, is neither bad nor good. 
D) Dividend yield ratio = Market price per share ÷ Dividends per share.

Question 15

Use the following information to answer questions 
Green Thumb Garden Supplies reported the following information for 2021 and 2022.
  
-What is the current ratio for 2022?

Accepted Answer

A) 2.0:1 
B) 1.7:1 
C) 1.6:1 
D) 0.6:1 
A) 2.0:1 
B) 1.7:1 
C) 1.6:1 
D) 0.6:1

Question 16

Non-GAAP measures are

Accepted Answer

A) management-defined measures of financial performance that are not usually found in the management discussion and analysis section of a public company's annual or quarterly report. 
B) management-defined measures of financial performance that are not included in accounting standards. 
C) included in accounting standards but are specifically non-financial in nature. 
D) management-defined measures of non-financial performance that are not included in accounting standards. 
A) management-defined measures of financial performance that are not usually found in the management discussion and analysis section of a public company's annual or quarterly report. 
B) management-defined measures of financial performance that are not included in accounting standards. 
C) included in accounting standards but are specifically non-financial in nature. 
D) management-defined measures of non-financial performance that are not included in accounting standards.

Question 17

A statement of income would not include

Accepted Answer

A) assets held for sale of a discontinued operation. 
B) a loss on disposal of a component of an entity. 
C) an operating loss on discontinued operations. 
D) an unusually large bad debt expense. 
A) assets held for sale of a discontinued operation. 
B) a loss on disposal of a component of an entity. 
C) an operating loss on discontinued operations. 
D) an unusually large bad debt expense.

Question 18

Horizontal analysis is a technique for evaluating financial statement data

Accepted Answer

A) within a period of time. 
B) over a period of time. 
C) on a certain date. 
D) as it may appear in the future. 
A) within a period of time. 
B) over a period of time. 
C) on a certain date. 
D) as it may appear in the future.

Question 19

Use the following information for questions 
  
-In performing a vertical analysis, the percentage for accounts receivable is

Accepted Answer

A) 0.5%. 
B) 1.0%. 
C) 5.0%. 
D) 10.0%. 
A) 0.5%. 
B) 1.0%. 
C) 5.0%. 
D) 10.0%.

Question 20

The return on common shareholders' equity ratio is affected by the

Accepted Answer

A) gross profit margin and profit margin ratio. 
B) profit margin and free cash flow. 
C) times interest earned and debt to total assets ratios. 
D) return on assets and debt to total assets ratios. 
A) gross profit margin and profit margin ratio. 
B) profit margin and free cash flow. 
C) times interest earned and debt to total assets ratios. 
D) return on assets and debt to total assets ratios.

Affluent Limited reported the following on its statement of income: Interest expense was $150,000.Gifford's times interest earned was

Comparisons of company data with industry averages provide information about a company's relative position within the industry.

The gain (loss) on disposal of a discontinued operation is not reported on the statement of income.

Which of the following solvency positions would a company consider most favourable?

The current ratio is

Use the following information to answer questions Green Thumb Garden Supplies reported the following information for 2021 and 2022: -What is the profit margin for 2022?

The price-earnings ratio reflects investors' expectations about the future profitability of the company.

The current ratio is a

Free cash flow is the cash available after a company pays dividends.

Use the following information to answer questions Green Thumb Garden Supplies reported the following information for 2021 and 2022: -What is the dividend yield for 2022?

A common measure of profitability is the

The return on assets ratio is affected by the

The first step in any comprehensive analysis is to perform a horizontal and vertical analysis.

Which of the following is false about the dividend yield ratio?

Use the following information to answer questions Green Thumb Garden Supplies reported the following information for 2021 and 2022. -What is the current ratio for 2022?

Non-GAAP measures are

A statement of income would not include

Horizontal analysis is a technique for evaluating financial statement data

Use the following information for questions -In performing a vertical analysis, the percentage for accounts receivable is

The return on common shareholders' equity ratio is affected by the

The Purpose and Use of Financial Statements

A Further Look at Financial Statements

The Accounting Information System

Accrual Accounting Concepts

Merchandising Operations

Reporting and Analyzing Inventory

Internal Control and Cash

Reporting and Analyzing Receivables

Reporting and Analyzing Long-Lived Assets

Reporting and Analyzing Liabilities

Reporting and Analyzing Shareholders Equity

Reporting and Analyzing Investments

Statement of Cash Flows

Filters

Exam 14: Performance Measurement

Affluent Limited reported the following on its statement of income: Interest expense was $150,000.Gifford's times interest earned was

Comparisons of company data with industry averages provide information about a company's relative position within the industry.

The gain (loss) on disposal of a discontinued operation is not reported on the statement of income.

Which of the following solvency positions would a company consider most favourable?

The current ratio is

Use the following information to answer questions Green Thumb Garden Supplies reported the following information for 2021 and 2022: -What is the profit margin for 2022?

The price-earnings ratio reflects investors' expectations about the future profitability of the company.

The current ratio is a

Free cash flow is the cash available after a company pays dividends.

Use the following information to answer questions Green Thumb Garden Supplies reported the following information for 2021 and 2022: -What is the dividend yield for 2022?

A common measure of profitability is the

The return on assets ratio is affected by the

The first step in any comprehensive analysis is to perform a horizontal and vertical analysis.

Which of the following is false about the dividend yield ratio?

Use the following information to answer questions Green Thumb Garden Supplies reported the following information for 2021 and 2022. -What is the current ratio for 2022?

Non-GAAP measures are

A statement of income would not include

Horizontal analysis is a technique for evaluating financial statement data

Use the following information for questions -In performing a vertical analysis, the percentage for accounts receivable is

The return on common shareholders' equity ratio is affected by the

The Purpose and Use of Financial Statements

A Further Look at Financial Statements

The Accounting Information System

Accrual Accounting Concepts

Merchandising Operations

Reporting and Analyzing Inventory

Internal Control and Cash

Reporting and Analyzing Receivables

Reporting and Analyzing Long-Lived Assets

Reporting and Analyzing Liabilities

Reporting and Analyzing Shareholders Equity

Reporting and Analyzing Investments

Statement of Cash Flows

Filters