Question 1

Which financial ratio indicates the percentage of profit that is paid out as dividends?

Accepted Answer

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

Question 2

A typical financial analysis of a firm would include a study of the operating statements for five or so years.

Accepted Answer

A) True 
 B)False

Question 3

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 4

All of the following ratios are used in the calculation of a company's Z-value EXCEPT

Accepted Answer

A)  working capital/total assets. 
B)  retained earnings/total assets. 
C)  current assets/current liabilities. 
D)  market value of equity/total liabilities. 
E)  sales/total assets. 
A)  working capital/total assets. 
B)  retained earnings/total assets. 
C)  current assets/current liabilities. 
D)  market value of equity/total liabilities. 
E)  sales/total assets.

Question 5

A typical financial analysis would compare the firm under study with industry standards.

Accepted Answer

A) True 
 B)False

Question 6

Which financial ratio measures the utilization of plant and equipment?

Accepted Answer

A)  days of inventory 
B)  asset turnover 
C)  average collection period 
D)  fixed asset turnover 
E)  inventory turnover 
A)  days of inventory 
B)  asset turnover 
C)  average collection period 
D)  fixed asset turnover 
E)  inventory turnover

Question 7

According to Schilit, unusually high goodwill gains related to recent acquisitions is a red flag, suggesting an underlying problem.

Accepted Answer

A) True 
 B)False

Question 8

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

Accepted Answer

A) True 
 B)False

Question 9

10-K forms include detailed information not usually available in an annual report.

Accepted Answer

A) True 
 B)False

Question 10

What financial ratio serves as a short-term indicator of the company's ability to pay its short-term liabilities from its short-term assets?

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 11

Which financial ratio measures the rate of return on the book value of shareholders' total investment in the company?

Accepted Answer

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

Question 12

What is the main purpose of conducting outside research into the environmental setting of the case?

Accepted Answer

A)  It allows students to identify how the company addressed the problem. 
B)  It provides a learning experience on library usage which is helpful in all courses. 
C)  It gives a realistic background of the industry during a specified period. 
D)  It gives you clues as to what the organization should be doing in the future. 
E)  It furnishes large amounts of data - both pertinent and extraneous. 
A)  It allows students to identify how the company addressed the problem. 
B)  It provides a learning experience on library usage which is helpful in all courses. 
C)  It gives a realistic background of the industry during a specified period. 
D)  It gives you clues as to what the organization should be doing in the future. 
E)  It furnishes large amounts of data - both pertinent and extraneous.

Question 13

At what Z-value level is a firm considered healthy?

Accepted Answer

A)  below 1.81 
B)  above 3.0 
C)  above 5.0 
D)  between 6.0 and 10.0 
E)  above 100 
A)  below 1.81 
B)  above 3.0 
C)  above 5.0 
D)  between 6.0 and 10.0 
E)  above 100

Question 14

Which financial indicator is calculated as the ratio of annual credit sales to accounts receivable?

Accepted Answer

A)  days of cash 
B)  average collection period 
C)  accounts receivable turnover 
D)  inventory turnover 
E)  net working capital turnover 
A)  days of cash 
B)  average collection period 
C)  accounts receivable turnover 
D)  inventory turnover 
E)  net working capital turnover

Question 15

According to the text, what percentage of portfolio managers use annual reports when making decisions?

Accepted Answer

A)  20% 
B)  35% 
C)  50% 
D)  60% 
E)  80% 
A)  20% 
B)  35% 
C)  50% 
D)  60% 
E)  80%

Question 16

The formula which predicts the likelihood of a corporation going bankrupt 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 17

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.

Which financial ratio indicates the percentage of profit that is paid out as dividends?

A typical financial analysis of a firm would include a study of the operating statements for five or so years.

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

All of the following ratios are used in the calculation of a company's Z-value EXCEPT

A typical financial analysis would compare the firm under study with industry standards.

Which financial ratio measures the utilization of plant and equipment?

According to Schilit, unusually high goodwill gains related to recent acquisitions is a red flag, suggesting an underlying problem.

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

10-K forms include detailed information not usually available in an annual report.

What financial ratio serves as a short-term indicator of the company's ability to pay its short-term liabilities from its short-term assets?

Which financial ratio measures the rate of return on the book value of shareholders' total investment in the company?

What is the main purpose of conducting outside research into the environmental setting of the case?

At what Z-value level is a firm considered healthy?

Which financial indicator is calculated as the ratio of annual credit sales to accounts receivable?

According to the text, what percentage of portfolio managers use annual reports when making decisions?

The formula which predicts the likelihood of a corporation going bankrupt is called

All of the following ratios represent activity ratios EXCEPT

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 ratio indicates the percentage of profit that is paid out as dividends?

A typical financial analysis of a firm would include a study of the operating statements for five or so years.

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

All of the following ratios are used in the calculation of a company's Z-value EXCEPT

A typical financial analysis would compare the firm under study with industry standards.

Which financial ratio measures the utilization of plant and equipment?

According to Schilit, unusually high goodwill gains related to recent acquisitions is a red flag, suggesting an underlying problem.

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

10-K forms include detailed information not usually available in an annual report.

What financial ratio serves as a short-term indicator of the company's ability to pay its short-term liabilities from its short-term assets?

Which financial ratio measures the rate of return on the book value of shareholders' total investment in the company?

What is the main purpose of conducting outside research into the environmental setting of the case?

At what Z-value level is a firm considered healthy?

Which financial indicator is calculated as the ratio of annual credit sales to accounts receivable?

According to the text, what percentage of portfolio managers use annual reports when making decisions?

The formula which predicts the likelihood of a corporation going bankrupt is called

All of the following ratios represent activity ratios EXCEPT

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