Question 1

Between 1997 and 1999, what percent of the mergers used the pooling approach to account for the value of the companies' stocks?

Accepted Answer

A)  95% 
B)  80% 
C)  55% 
D)  40% 
E)  20% 
A)  95% 
B)  80% 
C)  55% 
D)  40% 
E)  20% D

Question 2

Among the most useful and important documents that can be used to understand why actions were taken are

Accepted Answer

A)  news releases. 
B)  product specification reports. 
C)  its corporate history. 
D)  annual reports. 
E)  10-Q forms. 
A)  news releases. 
B)  product specification reports. 
C)  its corporate history. 
D)  annual reports. 
E)  10-Q forms. D

Question 3

Ratio analysis is a valuable part of SWOT analysis, helping to assess the company's overall situation and pinpoint some problem areas.

Accepted Answer

A) True 
 B)False  True

Question 4

Which of the following is a red flag according to Schilit?

Accepted Answer

A)  cash flow from operations drops below net income 
B)  accounts receivable growing faster than sales 
C)  fluctuating gross margins over time 
D)  nepotism on the board of directors 
E)  all of the above 
A)  cash flow from operations drops below net income 
B)  accounts receivable growing faster than sales 
C)  fluctuating gross margins over time 
D)  nepotism on the board of directors 
E)  all of the above

Question 5

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 6

Which financial ratio measures the extent to which the company's capital is in cash or cash equivalents?

Accepted Answer

A)  quick ratio 
B)  current ratio 
C)  cash ratio 
D)  strategic ratio 
E)  inventory ratio 
A)  quick ratio 
B)  current ratio 
C)  cash ratio 
D)  strategic ratio 
E)  inventory ratio

Question 7

At what Z-value level is a firm considered in serious trouble?

Accepted Answer

A)  below 1.81 
B)  above 1.81 
C)  greater than 5.0 
D)  between 2.2 and 3.1 
E)  between 3.2 and 4.1 
A)  below 1.81 
B)  above 1.81 
C)  greater than 5.0 
D)  between 2.2 and 3.1 
E)  between 3.2 and 4.1

Question 8

The quick ratio is also known as the

Accepted Answer

A)  key profitability ratio. 
B)  EPS. 
C)  acid test. 
D)  asset turnover. 
E)  key activity ratio. 
A)  key profitability ratio. 
B)  EPS. 
C)  acid test. 
D)  asset turnover. 
E)  key activity ratio.

Question 9

The Z-value formula combines five ratios by weighting them according to their importance to a corporation's financial strength.

Accepted Answer

A) True 
 B)False

Question 10

The Z-value uses ________ ratios and weights them according to their importance to a corporation's financial strength.

Accepted Answer

A)  2 
B)  3 
C)  4 
D)  5 
E)  6 
A)  2 
B)  3 
C)  4 
D)  5 
E)  6

Question 11

One way to adjust for inflation for global operations outside the United States is to use the U.S.Consumer Price Index (CPI).

Accepted Answer

A) True 
 B)False

Question 12

In case analysis, it is best to make an exhibit that includes all the financial ratios.

Accepted Answer

A) True 
 B)False

Question 13

Which financial ratio is a measure of the ability of the company to meet all of its fixed-charge obligations?

Accepted Answer

A)  debt to asset ratio 
B)  debt to equity ratio 
C)  times interest earned 
D)  long-term debt to capital structure 
E)  coverage of fixed charges 
A)  debt to asset ratio 
B)  debt to equity ratio 
C)  times interest earned 
D)  long-term debt to capital structure 
E)  coverage of fixed charges

Question 14

Fixed asset turnover is what type of financial ratio?

Accepted Answer

A)  liquidity ratio 
B)  profitability ratio 
C)  leverage ratio 
D)  activity ratio 
E)  revenue ratio 
A)  liquidity ratio 
B)  profitability ratio 
C)  leverage ratio 
D)  activity ratio 
E)  revenue ratio

Question 15

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 16

Dollars adjusted for inflation to make them comparable over various years are known as

Accepted Answer

A)  consumer dollars. 
B)  constant dollars. 
C)  consumer inflation. 
D)  constant inflation. 
E)  earning dollars. 
A)  consumer dollars. 
B)  constant dollars. 
C)  consumer inflation. 
D)  constant inflation. 
E)  earning dollars.

Question 17

An important liquidity ratio is Earnings per Share (EPS).

Accepted Answer

A) True 
 B)False

Question 18

All of the following ratios reflect leverage ratios EXCEPT

Accepted Answer

A)  debt to asset ratio. 
B)  times interest earned. 
C)  coverage of fixed charges. 
D)  price/earnings ratio. 
E)  debt to equity ratio. 
A)  debt to asset ratio. 
B)  times interest earned. 
C)  coverage of fixed charges. 
D)  price/earnings ratio. 
E)  debt to equity ratio.

Question 19

If a firm's trends in common-size statements are generally in line with those of the rest of the industry, problems are less likely than if the firm's trends are worse than the industry average.

Accepted Answer

A) True 
 B)False

Question 20

List Schilit's short checklist of items to examine for red flags.

Accepted Answer

Schilit proposes a checklist of items to

Between 1997 and 1999, what percent of the mergers used the pooling approach to account for the value of the companies' stocks?

Among the most useful and important documents that can be used to understand why actions were taken are

Ratio analysis is a valuable part of SWOT analysis, helping to assess the company's overall situation and pinpoint some problem areas.

Which of the following is a red flag according to Schilit?

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

Which financial ratio measures the extent to which the company's capital is in cash or cash equivalents?

At what Z-value level is a firm considered in serious trouble?

The quick ratio is also known as the

The Z-value formula combines five ratios by weighting them according to their importance to a corporation's financial strength.

The Z-value uses ________ ratios and weights them according to their importance to a corporation's financial strength.

One way to adjust for inflation for global operations outside the United States is to use the U.S.Consumer Price Index (CPI).

In case analysis, it is best to make an exhibit that includes all the financial ratios.

Which financial ratio is a measure of the ability of the company to meet all of its fixed-charge obligations?

Fixed asset turnover is what type of financial ratio?

Which of the following is NOT true of case analysis?

Dollars adjusted for inflation to make them comparable over various years are known as

An important liquidity ratio is Earnings per Share (EPS).

All of the following ratios reflect leverage ratios EXCEPT

If a firm's trends in common-size statements are generally in line with those of the rest of the industry, problems are less likely than if the firm's trends are worse than the industry average.

List Schilit's short checklist of items to examine for red flags.

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

Exam 12: Suggestions for Case Analysis

Between 1997 and 1999, what percent of the mergers used the pooling approach to account for the value of the companies' stocks?

Among the most useful and important documents that can be used to understand why actions were taken are

Ratio analysis is a valuable part of SWOT analysis, helping to assess the company's overall situation and pinpoint some problem areas.

Which of the following is a red flag according to Schilit?

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

Which financial ratio measures the extent to which the company's capital is in cash or cash equivalents?

At what Z-value level is a firm considered in serious trouble?

The quick ratio is also known as the

The Z-value formula combines five ratios by weighting them according to their importance to a corporation's financial strength.

The Z-value uses ________ ratios and weights them according to their importance to a corporation's financial strength.

One way to adjust for inflation for global operations outside the United States is to use the U.S.Consumer Price Index (CPI).

In case analysis, it is best to make an exhibit that includes all the financial ratios.

Which financial ratio is a measure of the ability of the company to meet all of its fixed-charge obligations?

Fixed asset turnover is what type of financial ratio?

Which of the following is NOT true of case analysis?

Dollars adjusted for inflation to make them comparable over various years are known as

An important liquidity ratio is Earnings per Share (EPS).

All of the following ratios reflect leverage ratios EXCEPT

If a firm's trends in common-size statements are generally in line with those of the rest of the industry, problems are less likely than if the firm's trends are worse than the industry average.

List Schilit's short checklist of items to examine for red flags.

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