Exam 2: Introduction to Financial Statement Analysis

In 2015,an agricultural company introduced a new cropping process which reduced the cost of growing some of its crops.If sales in 2014 and 2015 were steady at $25 million,but the gross margin increased from 2.3% to 3.4% between those years,by what amount was the cost of sales reduced?

A firm has gross profit of $45 million,EBIT of $20 million,and net income of $8.5 million.If the firm has 5 million shares outstanding,what is the firm's EPS?

Which of the following amounts would be included on the right side of a statement of financial position?

Use the table for the question(s) below. Statement of Financial Position -If the above statement of financial position is for a retail company,what indications about this company would best be drawn from the changes in quick ratio between 2014 and 2015?

Which of the following firms would be expected to have a high ROE based on that firm's high operating efficiency?

In Canada,publicly traded companies can choose whether or not they wish to release periodic financial statements.

A company has a share price of $24.50 and 118 million shares outstanding.Its market-to-book ratio is 4.2,its book debt-equity ratio is 3.2,and it has cash of $800 million.How much would it cost to take over this business assuming you pay its enterprise value?

A company that produces drugs is preparing a statement of financial position.Which of the following would be most likely to be considered a long-term asset on this statement of financial position?

Use the table for the question(s) below. Income Statement for Xenon Manufacturing: -Consider the above Income Statement for Xenon Manufacturing.All values are in millions of dollars.Calculate the gross margin for 2014 and 2015.What does the change in the net profit margin between these two years imply about the company?

Use the table for the question(s) below. -Refer to the income statement above.Luther's net profit margin for the year ending December 31,2014 is closest to:

The third party who checks annual financial statements to ensure that they are prepared according to Generally Accepted Accounting Principles (GAAP)and verifies that the information reported is reliable is the

Gross profit is calculated as

A stock has 94 million shares outstanding,with a current share price of $3.53 per share.If the firm's book value of equity is $120 million,what is its market-to-book ratio?

Use the table for the question(s) below. -Refer to the income statement above.Luther's return on assets (ROA)for the year ending December 31,2015 is closest to:

Use the table for the question(s) below. Income Statement for Xenon Manufacturing: -Consider the above Income Statement for Xenon Manufacturing.All values are in millions of dollars.Calculate the operating margin for 2014 and 2015.What does the change in the operating margin between these two years imply about the company?

A firm whose primary business is in a line of regional grocery stores would be most likely to have to include which of the following facts,if true,in the firm's management discussion and analysis (MD&A)?

According to the text,did Enron follow Generally Accepted Accounting Principles (GAAP)in its financial reporting process?

A public company has a book value of $128 million.They have 20 million shares outstanding,with a market price of $4 per share.Which of the following statements is true regarding this company?

International Financial Reporting Standards are taking root throughout the world.However,it is unlikely that the Canada will report according to IFRS before the second half of the twenty-first century.

Use the table for the question(s) below. AOS Industries Statement of Cash Flows for 2015 -Consider the above statement of cash flows.What were AOS Industries' major means of raising money in 2015?