Question 1

Which financial indicator is calculated by the ratio of market price per share to earnings per share?

Accepted Answer

A) return on investment 
B) price/earnings ratio 
C) return on equity 
D) dividend yield on common stock 
E) dividend payout ratio 
A) return on investment 
B) price/earnings ratio 
C) return on equity 
D) dividend yield on common stock 
E) dividend payout ratio

Question 2

Which financial ratio measures the extent to which borrowed funds have been used to finance the company's assets?

Accepted Answer

A) debt to asset ratio 
B) debt to equity ratio 
C) long-term debt to capital structure 
D) times interest earned 
E) current liabilities to equity 
A) debt to asset ratio 
B) debt to equity ratio 
C) long-term debt to capital structure 
D) times interest earned 
E) current liabilities to equity

Question 3

The index of sustainable growth indicates how much of the growth rate of sales can be sustained by internally generated funds.

Accepted Answer

A) True 
 B)False

Question 4

The formula which indicates if a company embarking on a growth strategy will need to take on debt to fund this growth is called

Accepted Answer

A) the return on investment. 
B) the CAPM. 
C) the index of sustainable growth. 
D) operating cash flow. 
E) the Z-value. 
A) the return on investment. 
B) the CAPM. 
C) the index of sustainable growth. 
D) operating cash flow. 
E) the Z-value.

Question 5

What are common-size statements?

Accepted Answer

Common-size statements are income statem

Question 6

All of the following ratios represent activity ratios EXCEPT

Accepted Answer

A) accounts payable period. 
B) days of inventory. 
C) net working capital turnover. 
D) earnings per share. 
E) days of cash. 
A) accounts payable period. 
B) days of inventory. 
C) net working capital turnover. 
D) earnings per share. 
E) days of cash.

Question 7

Which financial indicator is calculated by the ratio of annual dividends per share to annual earnings per share?

Accepted Answer

A) dividend payout ratio 
B) dividend yield on common stock 
C) price/earnings ratio 
D) return on investment 
E) return on equity 
A) dividend payout ratio 
B) dividend yield on common stock 
C) price/earnings ratio 
D) return on investment 
E) return on equity

Question 8

The amount of change from one year to the next in GDP indicates how much that country's economy is growing.

Accepted Answer

A) True 
 B)False

Question 9

What benefit does converting sales and profits to constant dollars in times of inflation offer when analyzing a case?

Accepted Answer

A) It is helpful in predicting the future potential of the organization. 
B) It contributes to determining the risk factors when computing the Z-value. 
C) It shows the true performance of the corporation adjusted for inflation to make them comparable over year. 
D) It is easier for the financial analyst to judge the effectiveness of management's decision making. 
E) It provides a method which is familiar and easy to understand. 
A) It is helpful in predicting the future potential of the organization. 
B) It contributes to determining the risk factors when computing the Z-value. 
C) It shows the true performance of the corporation adjusted for inflation to make them comparable over year. 
D) It is easier for the financial analyst to judge the effectiveness of management's decision making. 
E) It provides a method which is familiar and easy to understand.

Question 10

Which of the following is NOT true of case analysis?

Accepted Answer

A) Case discussion focuses on critical analysis. 
B) A solution is satisfactory if it resolves important problems and if it is likely to be implemented successfully. 
C) Case analysis helps build analytic and decision-making skills. 
D) A solution is satisfactory if it reflects what the company actually did. 
E) Case discussion focuses on logical development of thought. 
A) Case discussion focuses on critical analysis. 
B) A solution is satisfactory if it resolves important problems and if it is likely to be implemented successfully. 
C) Case analysis helps build analytic and decision-making skills. 
D) A solution is satisfactory if it reflects what the company actually did. 
E) Case discussion focuses on logical development of thought.

Question 11

Which financial ratio shows the return on all of the assets under its control regardless of source of financing?

Accepted Answer

A) return on investment 
B) return on equity 
C) earnings per share 
D) gross profit margin 
E) net profit margin 
A) return on investment 
B) return on equity 
C) earnings per share 
D) gross profit margin 
E) net profit margin

Question 12

Which financial ratio shows the after-tax earnings generated for each share of common stock?

Accepted Answer

A) return on investment 
B) return on equity 
C) earnings per share 
D) gross profit margin 
E) net profit margin 
A) return on investment 
B) return on equity 
C) earnings per share 
D) gross profit margin 
E) net profit margin

Question 13

According to Yankelovich Partners survey firm, eight out of 10 portfolio managers and 35 percent of security analysts use annual reports when making decisions.

Accepted Answer

A) True 
 B)False

Question 14

According to Schilit, a change of more than 2% in gross margins from year to year is worth a closer look.

Accepted Answer

A) True 
 B)False

Question 15

The gross domestic product (GDP)is used worldwide and measures the total output of goods and services within a country's borders

Accepted Answer

A) True 
 B)False

Question 16

A company's annual report from the year of the case can be helpful, but the 10-K form is not beneficial for those conducting a case analysis.

Accepted Answer

A) True 
 B)False

Question 17

All of the following represent liquidity ratios EXCEPT

Accepted Answer

A) cash ratio. 
B) inventory to net working capital. 
C) quick ratio. 
D) gross profit margin. 
E) current ratio. 
A) cash ratio. 
B) inventory to net working capital. 
C) quick ratio. 
D) gross profit margin. 
E) current ratio.

Question 18

If the corporation being studied appears to be in poor financial condition, use Altman's Bankruptcy Formula to calculate its Z-value.

Accepted Answer

A) True 
 B)False

Question 19

According to Schilit, the search for hidden weaknesses in a company's performance is known as

Accepted Answer

A) a strategic audit. 
B) a SWOT analysis. 
C) forensic accounting. 
D) activity based accounting. 
E) competitive analysis. 
A) a strategic audit. 
B) a SWOT analysis. 
C) forensic accounting. 
D) activity based accounting. 
E) competitive analysis.

Question 20

Cases present actual business situations and enable you to examine both successful and unsuccessful corporations.

Accepted Answer

A) True 
 B)False

Which financial indicator is calculated by the ratio of market price per share to earnings per share?

Which financial ratio measures the extent to which borrowed funds have been used to finance the company's assets?

The index of sustainable growth indicates how much of the growth rate of sales can be sustained by internally generated funds.

The formula which indicates if a company embarking on a growth strategy will need to take on debt to fund this growth is called

What are common-size statements?

All of the following ratios represent activity ratios EXCEPT

Which financial indicator is calculated by the ratio of annual dividends per share to annual earnings per share?

The amount of change from one year to the next in GDP indicates how much that country's economy is growing.

What benefit does converting sales and profits to constant dollars in times of inflation offer when analyzing a case?

Which of the following is NOT true of case analysis?

Which financial ratio shows the return on all of the assets under its control regardless of source of financing?

Which financial ratio shows the after-tax earnings generated for each share of common stock?

According to Yankelovich Partners survey firm, eight out of 10 portfolio managers and 35 percent of security analysts use annual reports when making decisions.

According to Schilit, a change of more than 2% in gross margins from year to year is worth a closer look.

The gross domestic product (GDP)is used worldwide and measures the total output of goods and services within a country's borders

A company's annual report from the year of the case can be helpful, but the 10-K form is not beneficial for those conducting a case analysis.

All of the following represent liquidity ratios EXCEPT

If the corporation being studied appears to be in poor financial condition, use Altman's Bankruptcy Formula to calculate its Z-value.

According to Schilit, the search for hidden weaknesses in a company's performance is known as

Cases present actual business situations and enable you to examine both successful and unsuccessful corporations.

Basic Concepts in Strategic Management

Corporate Governance

Ethics and Social Responsibility in Strategic Management

Environmental Scanning and Industry Analysis

Internal Scanning and Organizational Analysis

Strategy Formulation: Situation Analysis and Business Strategy

Strategy Formulation: Corporate Strategy

Strategy Formulation: Functional Strategy and Strategic Choice

Strategy Implementation: Organizing for Action

Strategy Implementation: Staffing and Directing

Evaluation and Control

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Exam 12: Suggestions for Case Analysis

Which financial indicator is calculated by the ratio of market price per share to earnings per share?

Which financial ratio measures the extent to which borrowed funds have been used to finance the company's assets?

The index of sustainable growth indicates how much of the growth rate of sales can be sustained by internally generated funds.

The formula which indicates if a company embarking on a growth strategy will need to take on debt to fund this growth is called

What are common-size statements?

All of the following ratios represent activity ratios EXCEPT

Which financial indicator is calculated by the ratio of annual dividends per share to annual earnings per share?

The amount of change from one year to the next in GDP indicates how much that country's economy is growing.

What benefit does converting sales and profits to constant dollars in times of inflation offer when analyzing a case?

Which of the following is NOT true of case analysis?

Which financial ratio shows the return on all of the assets under its control regardless of source of financing?

Which financial ratio shows the after-tax earnings generated for each share of common stock?

According to Yankelovich Partners survey firm, eight out of 10 portfolio managers and 35 percent of security analysts use annual reports when making decisions.

According to Schilit, a change of more than 2% in gross margins from year to year is worth a closer look.

The gross domestic product (GDP)is used worldwide and measures the total output of goods and services within a country's borders

A company's annual report from the year of the case can be helpful, but the 10-K form is not beneficial for those conducting a case analysis.

All of the following represent liquidity ratios EXCEPT

If the corporation being studied appears to be in poor financial condition, use Altman's Bankruptcy Formula to calculate its Z-value.

According to Schilit, the search for hidden weaknesses in a company's performance is known as

Cases present actual business situations and enable you to examine both successful and unsuccessful corporations.

Basic Concepts in Strategic Management

Corporate Governance

Ethics and Social Responsibility in Strategic Management

Environmental Scanning and Industry Analysis

Internal Scanning and Organizational Analysis

Strategy Formulation: Situation Analysis and Business Strategy

Strategy Formulation: Corporate Strategy

Strategy Formulation: Functional Strategy and Strategic Choice

Strategy Implementation: Organizing for Action

Strategy Implementation: Staffing and Directing

Evaluation and Control

Filters