Exam 14: Financial Statements Structure and Interpretation

One of the fundamental types of business transactions that managers are constantly making decisions about and reviewing is capital asset transactions.

Financial statements provide vital information,to managers,regarding an organization's current assets and affluence position.

Efficiency refers to how effective the organization is in deploying its resources and managing its operational processes in the delivery of goods and/or services to the marketplace.

With respect to Financial Statements,managers generate the clearest picture of what is happening within an organization by reviewing all three together.

Leverage Analysis,whereby we look at trends occurring over time by analyzing financial statements across multiple time periods.

Name and briefly describe the four areas of importance of forecasting and budgeting.

The financial document that has been likened to a snapshot of how the company's finances are doing at that moment is called a(n)

All of the following are considered in an organization's solvency analysis,EXCEPT:

One of the fundamental types of business transactions that managers are constantly making decisions about and reviewing is liquidity transactions.

Liquidity is an issue that Not-for-profit (NFP) managers must manage.

The financial statement that represents an accumulation of all of a company's transactions since it began is the budget.

Trend Analysis,whereby we look at trends occurring over time by analyzing financial statements across multiple time periods.

Ratio Analysis is the process of assessing the impact of the amount of debt which an organization has incurred in order to finance its asset base.

Sales forecast is a step in the forecasting and budgetary process.

Ratio Analysis,whereby we look at trends occurring over time by analyzing financial statements across multiple time periods.

All of the following are reasons for the importance of forecasting and budgeting,EXCEPT:

Absolute Analysis is the process by which we assess and interpret the relationships between the financial results shown on an organization's financial statements.

Capital asset transactions are decisions which managers make with respect to investment and divestment of capital assets (buildings, equipment, business subsidiaries) which may be needed, or are no longer needed.

Name and briefly describe the primary tool which managers use to assess the financial health of an organization.

Although Capital Asset Transaction do not directly related to the current year's profit of the organization,they do impact on the wealth fluctuations of the organization over the period of time.