Exam 13: Measuring and Evaluating Financial Performance

Wayne,Inc.has net sales revenue of $348,800,cost of goods sold of $274,400,and net income of $2,400.If interest expense is $8,000 and income tax expense is $800,the times interest earned ratio is:

Assume that Charmin and Barker are two retailers selling different goods.Charmin reports a days to sell ratio of 6 days and Barker reports a days to sell ratio of 64 days.What types of merchandise are Charmin and Barker likely to sell,given their measures of days to sell?

The ratio that measures the percentage of financing from creditors is the:

Ratio analysis:

Match each term with the appropriate definition.Not all definitions will be used. -Profitability

Dearborn Company has earnings per share of $2.40,it paid a dividend of $1.00 per share,and the market price of the company's stock is $90 per share.The price/earnings ratio is closest to:

A current ratio of 2.5 means that for every dollar of:

Company X has net sales revenue of $1,250,000,cost of goods sold of $760,000,and all other expenses of $290,000.The beginning balance of stockholders' equity is $400,000 and the beginning balance of fixed assets is $361,000.The ending balance of stockholders' equity is $600,000 and the ending balance of fixed assets is $389,000. Required: Compute the return on equity (ROE)ratio.

Match each term with the appropriate definition.Not all definitions will be used. -Solvency

Which of the following statements is not true?

Match each term with the appropriate definition.Not all definitions will be used. -Net Income

Tilden Industries reported net sales revenue of $1,700,000 and paid no dividends during the current year.The following information is also available at the end of the current and prior years: Current Year Prior Year Total Current Assets \ 1,000,000 \ 900,000 Property, Plant, and Equipment, Net 1,700,000 1,400,000 Total Current Liabilities 450,000 390,000 Total Long-Tem Liabilities 600,000 500,000 Common Stock, \5 Par 1,000,000 1,000,000 Paid-In Capital in Excess of Par 200,000 200,000 Retained Earnings 450,000 210,000 There was no preferred stock outstanding during the current year. Required: Part a.Calculate the return on equity for the current year. Part b.Calculate the debt-to-assets ratio for the current year. Part c.Calculate the fixed asset turnover ratio for the current year. Part d.Calculate the current ratio for the current year. Round all ratios to two decimal points.

Vertical analysis is the comparison of a company's financial information over time.

If an analyst wants to examine a company's short-run ability to survive,which of the following would best be considered?

A condensed balance sheet for Morningstar,Inc.is presented below: Required: Part a.Prepare a vertical analysis of the balance sheet above.Round to the nearest whole percent. Part b.Interpret your analysis.Identify significant items.Comment on key relationships.

The assumption that a business is capable of continuing its operations long enough to meet its obligations is called the:

If a company increases the selling price of the product it sells and all other data on the financial statements remains the same,which of the following ratios will be unaffected?

The going-concern assumption states that the:

Which of the following factors would cause the least amount of concern about a company's ability to continue as a going-concern?

Which of the following measures would assist in assessing the profitability of a company?