Exam 20: Company Performance: Comprehensive Evaluation

When decision-makers want to know how well a firm manages the amounts owed to them by customers as compared to other firm's,they should use

Which of the following helps analysts understand the relationships among the items in a financial statement?

Use the following to answer questions The Ventura Company reported total stockholders' equity of $500,000 at December 31, 2010. In addition, there were 80,000 shares of common stock and zero shares of preferred stock outstanding for the entire year. During 2010, Ventura earned net income equal to $75,000, which included deductions of $7,000 for interest and $11,000 for income taxes. Total dividends paid to common stockholders during the year were $60,000. The company's statement of cash flows showed $56,000 in net cash inflows from operating activities, and its stock was selling for $17 per share on December 31, 2010. -The price earnings ratio at the end of 2010 was:

Is a firm that has a high dividend payout ratio better to invest in than one that has a low dividend payout ratio? Why or why not?

Use the following to answer questions Little Deer Industries gathered the following year-end data (in thousands) for 2010 and 2009: Curent Assets Long-Tenn Arsets 885 585 Curtert Liabilities 385 385 Long-Term Liabilities 575 575 Owners' Equity 575 265 Net Sales 975 775 Gross Margir 485 365 Net Income 255 100 -The return on owners' equity for 2010 was:

Use the following to answer questions Pioneer Industries gathered the following year-end data (in thousands) for 2010 and 2009: Curent Assets Long-Tenn Arsets 790 720 Curtert Liabilities 280 310 Long-Term Liabilities 410 440 Owners' Equity 445 335 Net Sales 830 790 Gross Margir 375 355 Net Income 120 105 -The asset turnover ratio for 2010 was:

A measure of a corporation's profitability that is required to be reported as part of the income statement is the:

Using the following income statements for Conduit Corporation for the years ended December 31,2010 and 2009,prepare a horizontal analysis showing both dollar amounts and percentages: Condun Corporation Comparative Income Statements For the Years Ended Decermber 31, 2010 ard 2009 Net sales \ Cost of goods sold Operating expenses: Selling expenses 29,000 26,000 General ard adruiristrative Expenses Operatirg income \ 36,000 \ 2,000

Explain the computation of cash flow per share.Do you believe cash flow per share should replace earnings per share? Why or why not?

If total assets for 2010 and 2009 were $500,000 and $530,000,respectively,then the percentage change shown in a horizontal analysis would be:

The Goldenrod Company gathered the following information: Stockholders' Equity as of December 31,2010: Market Price per Share of Stock on December 31,2010: $14 Assuming the common stock was outstanding for the entire year,calculate the following ratios for 2010: ( A)Cash Flow per Share (b)Times Interest Earned (c)Price Earnings Ratio (d)Dividend Payout Ratio (e)Dividend Yield

In a common-sized balance sheet,each item is shown as a percentage of

If a company's income statement showed sales equal to $365,000,a gross margin of $120,000,and net income of $45,000,then a vertical analysis of the income statement would show a percentage figure for net income equal to:

Which of the following ratios indicates a firm's financial flexibility (the ability to issue stock or borrow fund)?

Use the following to answer questions The Ventura Company reported total stockholders' equity of $500,000 at December 31, 2010. In addition, there were 80,000 shares of common stock and zero shares of preferred stock outstanding for the entire year. During 2010, Ventura earned net income equal to $75,000, which included deductions of $7,000 for interest and $11,000 for income taxes. Total dividends paid to common stockholders during the year were $60,000. The company's statement of cash flows showed $56,000 in net cash inflows from operating activities, and its stock was selling for $17 per share on December 31, 2010. -The dividend payout ratio was:

Colors Inc.gathered the following year-end data (in thousands)for 2008 and 2007: Current Assets \ 600 \ 675 Long-Term Assets 960 795 Current Liabilities 460 595 Long-Term Liabilities 650 785 Owners' Equity 650 475 Net Sales 1050 985 Gross Margin 560 575 Net Income 330 310 The current ratio at the end of 2010 was (show your work): The return on assets for 2010 was (show your work): The return on owners' equity for 2010 was (show your work): The asset turnover ratio for 2010 was (show your work): The gross margin percentage for 2010 was (show your work):

When a CPA firm finds that the financial statements of the company being audited are not in compliance with Generally Accepted Accounting Principle the firm will issue which of the following?

Brown Cow Inc.gathered the following year-end data (in thousands)for 2010 and 2009: Curent Assets Long-Tenn Arsets 960 795 Curtert Liabilities 460 595 Long-Term Liabilities 650 785 Owners' Equity 650 475 Net Sales 1050 985 Gross Margir 560 575 Net Income 330 310 The current ratio at the end of 2010 was (show your work): The return on assets for 2010 was (show your work): The return on owners' equity for 2010 was (show your work): The asset turnover ratio for 2010 was (show your work): The gross margin percentage for 2010 was (show your work):

All of the following ratios below are generally used to assess a firm's profitability except:

The times interest earned ratio is generally used to assess a firm's: