Refer to the following selected financial information from Graceworks, Corp. Compute the company's days' sales in inventory for Year 2. (Use 365 days a year.) $\begin{array}{|l|r|r|} \hline & \text { Year 2 } & {\text { Year 1 }} \\ \hline \text { Merchandise inventory } & 271,000 & 253,500 \\ \hline \text { Cost of goods sold } & 486,400 & 433,100\\\hline \end{array}$

A) 113.3. B) 228.4. C) 203.4. D) 179.5. E) 215.1. A) 113.3. B) 228.4. C) 203.4. D) 179.5. E) 215.1.

Refer to the following selected financial information from McCormik, LLC. Compute the company's acid-test ratio for Year 2. $\begin{array}{|l|r|r|} \hline & \text { Year 2 } & {\text { Year 1 }} \\ \hline \text { Cash } & \$ 37,500 & 36,850 \\ \hline \text { Short-term investments } & 90,000 & 90,000 \\ \hline \text { Accounts receivable, net } & 85,500 & 86,250 \\ \hline \text { Merchandise inventory } & 121,000 & 117,000 \\\hline \text { Prepaid expenses } & 12,100 & 13,500 \\ \hline \text { Plant assets } & 388,000 & 392,000 \\ \hline \text { Accounts payable } & 113,400 & 111.750 \\ \hline \text { Net sales } & 711,000 & 706,000 \\ \hline \text { Cost of goods sold } & 390,000 & 385,500 \\ \hline \end{array}$

A) 1.98. B) 3.05. C) 1.88. D) 2.26. E) 2.95. A) 1.98. B) 3.05. C) 1.88. D) 2.26. E) 2.95.

Refer to the following selected financial information from McCormik, LLC. Compute the company's inventory turnover for Year 2. $\begin{array}{|l|r|r|} \hline & \text { Year 2 } & {\text { Year 1 }} \\ \hline \text { Cash } & \$ 37,500 & 36,850 \\ \hline \text { Short-term investments } & 90,000 & 90,000 \\ \hline \text { Accounts receivable, net } & 85,500 & 86,250 \\ \hline \text { Merchandise inventory } & 121,000 & 117,000 \\\hline \text { Prepaid expenses } & 12,100 & 13,500 \\ \hline \text { Plant assets } & 388,000 & 392,000 \\ \hline \text { Accounts payable } & 113,400 & 111.750 \\ \hline \text { Net sales } & 711,000 & 706,000 \\ \hline \text { Cost of goods sold } & 390,000 & 385,500 \\ \hline \end{array}$

A) 3.86. B) 5.78. C) 3.28. D) 4.33. E) 4.72. A) 3.86. B) 5.78. C) 3.28. D) 4.33. E) 4.72.

Exam 17: Analysis of Financial Statements

Refer to the following selected financial information from Graceworks, Corp. Compute the company's days' sales in inventory for Year 2. (Use 365 days a year.) Year 2 Year 1 Merchandise inventory 271,000 253,500 Cost of goods sold 486,400 433,100

(Multiple Choice)

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Question 81

Internal users of financial information:

(Multiple Choice)

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Question 82

The evaluation of company performance and financial condition includes evaluation of (1)past and current performance, (2)current financial position, and (3)future performance and risk.

(True/False)

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Question 83

Total asset turnover reflects a company's ability to use its assets to generate sales and is an important indication of operating efficiency.

(True/False)

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Question 84

A brief focus on important analysis results and conclusions is usually included in which of the following sections of a financial statement analysis report:

(Multiple Choice)

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Question 85

Financial analysis only refers to the communication of relevant financial information to decision makers.

(True/False)

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Question 86

Financial statement analysis involves all of the following except:

(Multiple Choice)

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Question 87

One purpose of financial statement analysis for internal users is to provide strategic information to improve company efficiency and effectiveness in providing products and services.

(True/False)

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Question 88

The common-size percent is computed by:

(Multiple Choice)

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Question 89

If a company is comparing its financial condition or performance to a base amount, it is using vertical analysis.

(True/False)

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Question 90

The return on total assets ratio is a profitability measure.

(True/False)

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Question 91

Clairmont Industries reported Net income of $283,000 and average Total assets of $637,000. The Return on total assets is:

(Multiple Choice)

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Question 92

Refer to the following selected financial information from McCormik, LLC. Compute the company's acid-test ratio for Year 2. Year 2 Year 1 Cash \ 37,500 36,850 Short-term investments 90,000 90,000 Accounts receivable, net 85,500 86,250 Merchandise inventory 121,000 117,000 Prepaid expenses 12,100 13,500 Plant assets 388,000 392,000 Accounts payable 113,400 111.750 Net sales 711,000 706,000 Cost of goods sold 390,000 385,500

(Multiple Choice)

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Question 93

Capital structure refers to a company's long-run financial viability and its ability to cover long-term obligations.

(True/False)

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Question 94

Match each of the following terms with the appropriate formulas. - $\frac{\text { Accounts receivable }}{\text { Net sales }}$ *365

(Multiple Choice)

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Question 95

Jones Corp. reported current assets of $193,000 and current liabilities of $137,000 on its most recent balance sheet. The current ratio is:

(Multiple Choice)

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Question 96

Refer to the following selected financial information from McCormik, LLC. Compute the company's inventory turnover for Year 2. Year 2 Year 1 Cash \ 37,500 36,850 Short-term investments 90,000 90,000 Accounts receivable, net 85,500 86,250 Merchandise inventory 121,000 117,000 Prepaid expenses 12,100 13,500 Plant assets 388,000 392,000 Accounts payable 113,400 111.750 Net sales 711,000 706,000 Cost of goods sold 390,000 385,500

(Multiple Choice)

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Question 97

Horizontal analysis is the comparison of a company's financial condition and performance across time.

(True/False)

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Question 98

Ash Company reported sales of $400,000 for Year 1, $450,000 for Year 2, and $500,000 for Year 1. Using Year 1 as the base year, what is the revenue trend percent for Years 2 and 3?

(Multiple Choice)

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Question 99

All of the following are true of a financial statement analysis report, except:

(Multiple Choice)

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Question 100

Refer to the following selected financial information from Graceworks, Corp. Compute the company's days' sales in inventory for Year 2. (Use 365 days a year.) Year 2 Year 1 Merchandise inventory 271,000 253,500 Cost of goods sold 486,400 433,100

Internal users of financial information:

The evaluation of company performance and financial condition includes evaluation of (1)past and current performance, (2)current financial position, and (3)future performance and risk.

Total asset turnover reflects a company's ability to use its assets to generate sales and is an important indication of operating efficiency.

A brief focus on important analysis results and conclusions is usually included in which of the following sections of a financial statement analysis report:

Financial analysis only refers to the communication of relevant financial information to decision makers.

Financial statement analysis involves all of the following except:

One purpose of financial statement analysis for internal users is to provide strategic information to improve company efficiency and effectiveness in providing products and services.

The common-size percent is computed by:

If a company is comparing its financial condition or performance to a base amount, it is using vertical analysis.

The return on total assets ratio is a profitability measure.

Clairmont Industries reported Net income of $283,000 and average Total assets of $637,000. The Return on total assets is:

Capital structure refers to a company's long-run financial viability and its ability to cover long-term obligations.

Match each of the following terms with the appropriate formulas. - $\frac{\text { Accounts receivable }}{\text { Net sales }}$ *365

Jones Corp. reported current assets of $193,000 and current liabilities of $137,000 on its most recent balance sheet. The current ratio is:

Horizontal analysis is the comparison of a company's financial condition and performance across time.

Ash Company reported sales of $400,000 for Year 1, $450,000 for Year 2, and $500,000 for Year 1. Using Year 1 as the base year, what is the revenue trend percent for Years 2 and 3?

All of the following are true of a financial statement analysis report, except:

Accounting in Business

Analyzing and Recording Transactions

Adjusting Accounts and Preparing Financial Statements

Completing the Accounting Cycle

Accounting for Merchandising Operations

Inventories and Cost of Sales

Accounting Information Systems

Cash and Internal Controls

Accounting for Receivables

Plant Assets, Natural Resoures, and Intangibles

Current Liabilities and Payroll Accounting

Accounting for Partnerships

Accounting for Corporations

Long-Term Liabilities

Investments and International Operations

Reporting the Statement of Cash Flows

Filters

Exam 17: Analysis of Financial Statements

Refer to the following selected financial information from Graceworks, Corp. Compute the company's days' sales in inventory for Year 2. (Use 365 days a year.) Year 2 Year 1 Merchandise inventory 271,000 253,500 Cost of goods sold 486,400 433,100

Internal users of financial information:

The evaluation of company performance and financial condition includes evaluation of (1)past and current performance, (2)current financial position, and (3)future performance and risk.

Total asset turnover reflects a company's ability to use its assets to generate sales and is an important indication of operating efficiency.

A brief focus on important analysis results and conclusions is usually included in which of the following sections of a financial statement analysis report:

Financial analysis only refers to the communication of relevant financial information to decision makers.

Financial statement analysis involves all of the following except:

One purpose of financial statement analysis for internal users is to provide strategic information to improve company efficiency and effectiveness in providing products and services.

The common-size percent is computed by:

If a company is comparing its financial condition or performance to a base amount, it is using vertical analysis.

The return on total assets ratio is a profitability measure.

Clairmont Industries reported Net income of $283,000 and average Total assets of $637,000. The Return on total assets is:

Capital structure refers to a company's long-run financial viability and its ability to cover long-term obligations.

Match each of the following terms with the appropriate formulas. - Accounts receivable Net sales \frac{\text { Accounts receivable }}{\text { Net sales }} Net sales Accounts receivable ​ *365

Jones Corp. reported current assets of $193,000 and current liabilities of $137,000 on its most recent balance sheet. The current ratio is:

Horizontal analysis is the comparison of a company's financial condition and performance across time.

Ash Company reported sales of $400,000 for Year 1, $450,000 for Year 2, and $500,000 for Year 1. Using Year 1 as the base year, what is the revenue trend percent for Years 2 and 3?

All of the following are true of a financial statement analysis report, except:

Accounting in Business

Analyzing and Recording Transactions

Adjusting Accounts and Preparing Financial Statements

Completing the Accounting Cycle

Accounting for Merchandising Operations

Inventories and Cost of Sales

Accounting Information Systems

Cash and Internal Controls

Accounting for Receivables

Plant Assets, Natural Resoures, and Intangibles

Current Liabilities and Payroll Accounting

Accounting for Partnerships

Accounting for Corporations

Long-Term Liabilities

Investments and International Operations

Reporting the Statement of Cash Flows

Filters

Match each of the following terms with the appropriate formulas. - $\frac{\text { Accounts receivable }}{\text { Net sales }}$ *365