Exam 13: Financial Statement Analysis

Auto Industries Company reported the following on its income statement: Income before income taxes \ 420,000 Income tax expense Net income \ 300,000 ? If the income statement also shows interest expense equal to $80,000, what is the company's times interest earned ratio?

Liquidity analysis is required

The profit margin ratio reflects the amount of income for each dollar of sales.

Use the selected data from Pinecrest Company's financial statements to answer the following question. Cash \ 22,000 \ 14,000 Accounts receivable 42,000 16,000 Merchandise inventory 22,000 83,000 Prepaid expenses Total current assets Total current liabilities \ 65,000 \ 72,000 Net credit sales 221,000 326,000 Cost of goods sold 168,000 299,000 Net cash flow from operating activities 16,000 29,000 ​ ​ -Refer to the data for Pinecrest Company. ? Competitors in Pinecrest Company's industry have an average inventory turnover of 20.8 times.Its inventory turnover for 2017

Which of the following is a total dollar measure of liquidity?

Analysts trying to make investment decisions may very well ignore discontinued operations, and extraordinary items.

To review the current market price of the stock, one should review the

Select the term below most properly satisfies each statement. -A comparison of financial statement items within a single period

If the current ratio is 3 to 1 and the working capital is $100,000, then the current assets are

______________________________________ is a line item on the income statement to reflect the net income or loss of a discontinued business segment as well as any gain or loss incurred from its disposal.

Which of the following is true regarding the relationship of the current ratio to the quick ratio?

Which of the following statements is true?

For each ratio listed, select whether an increase or decrease in the ratio is generally considered to be better. -Dividend yield ratio

Dividends to preferred stockholders are deducted from net income when calculating the return on common stockholders' equity ratio because

Select the ratio that each statement below most properly satisfies. -A measure of the ability of a company to finance long-term asset acquisitions from cash from operations

Sandy Shores, Inc.reported the following amounts in its financial statements: Average merchandise inventory \ 200,000 \ 120,000 Cost of goods sold 4,000,000 3,000,000 From 2016 to 2017, the company's management of inventory is

Which of the following ratios is the best measure in analyzing a company's ability to pay interest on long-term debt and to repay the long-term debt over several years?

Comparing one company with another in the same industry should cause no problems since companies in the same industry are required to use the same GAAP.

Select the term below most properly satisfies each statement. -A comparison of financial statement items over a period of time

For each ratio listed, select whether an increase or decrease in the ratio is generally considered to be better. -Times interest earned ratio