Exam 12: Performance Evaluation Revisited: a Balanced Approach

Last year Boxer Corporation had net income of $24,000, income tax expense of $7,200 and interest expense of $2,000.What is Boxer's times interest earned ratio?

Gant Wholesale Company has $2,000 in cash, $7,000 in accounts receivable, $12,000 in inventory, and $3,000 in prepaid expenses.Liabilities totaled $20,000, with $6,000 current and $14,000 long-term.What is Gant's acid-test ratio?

The 2020 and 2021 partial balance sheets for Ottoman Manufacturing Company appear below along with selected financial information: Required: a.Calculate Ottoman's inventory turnover and average days to sell inventory for 2021. b.Calculate Ottoman's accounts receivable turnover and average collection period for 2021.

Dun & Bradstreet's Industry Norms and Key Business Ratios provide financial ratios for key industries, as well as condensed common-sized balance sheets and income statements.

Which of the following parties are not interested in a company's ability to remain profitable over the long-run?

The most common measure of short-term liquidity is the quick ratio.

The debt ratio measures the ratio of liabilities to

The formula for determining the common-size percentage for liabilities is

The return on common stockholders' equity measures how

Which of the following statements relating to earnings per share is not true?

Which of the following is the reason that preferred dividends declared during the period are deducted from net income in calculating return on common stockholders' equity?

Answer the following questions related to common-size financial statements? a.What are common-size financial statements? How are common-size financial statements used? b.What is the base for a common-size income statement? c.What is the base for a common-size balance sheet?

Which of the following is not an advantage of a company using equity rather than debt to finance a project?

In a horizontal analysis balance sheet, the percentage change columns do not add up in the same way as the dollar amounts because each of the percentages was calculated using a different denominator.

Common-size statements are especially useful in comparing

Inventory turnover measures how many times, on average, a company's inventory is sold during the year.

On a common-size income statement, income taxes are shown as a percentage of

Earnings per share must be reported on the face of every income statement that is prepared in accordance with

On a common-size balance sheet, common stock is shown as a percentage of

The difference between a firm's current assets and its current liabilities is