Exam 2: Introduction to Financial Statement Analysis

In 2009,an agricultural company introduced a new cropping process which reduced the cost of growing some of its crops.If sales in 2008 and 2009 were steady at $25 million,but the gross margin increased from 2.3% to 3.4% between those years,by what amount was the cost of sales reduced?

What is a firm's gross profit?

Use the table for the question(s)below. -Refer to the income statement above.Luther's return on assets (ROA)for the year ending December 31,2006 is closest to:

Which of the following is not an operating expense?

GenCorp has a total debt of $140 million and stockholders' equity of $50 million.It also has 25 million shares outstanding,with a market price of $3.50 per share.What is GenCorp's market debt-equity ratio?

What are the requirements of section 404 of SOX?

Use the table for the question(s)below. -Refer to the balance sheet above.If on December 31,2005 Luther has 8 million shares outstanding trading at $15 per share,then what is Luther's enterprise value?

Use the table for the question(s)below. Income Statement for Xenon Manufacturing: -Consider the above Income Statement for Xenon Manufacturing.All values are in millions of dollars.Calculate the gross margin for 2008 and 2009.What does the change in the gross margin between these two years imply about the company?

Use the table for the question(s)below. -The above diagram shows a balance sheet for a certain company.If the company buys new property,plant and equipment today using its entire cash balance,what will its net working capital be?

A company that produces drugs is preparing a balance sheet.Which of the following would be most likely to be considered a long-term asset on this balance sheet?

Use the table for the question(s)below. -If the above balance sheet is for a retail company,how has the company's leverage changed between 2007 and 2008?

Allen Company bought a new copy machine to be depreciated straight line for three years for use by sales personnel.Where would this purchase be reflected on the Statement of Cash Flows?

Which of the following best describes why the left and right sides of a balance sheet are equal?

Financial statements are accounting reports issued periodically by a firm which present information on the past performance of the firm,a summary of the firm's assets and the financing of those assets,and a prediction of the firm's future performance.

Use the table for the question(s)below. -Refer to the income statement above.Luther's operating margin for the year ending December 31,2005 is closest to:

A company has a share price of $24.50 and $118 million shares outstanding.Its market-to-book ratio is 4.2,its book debt-equity ratio is 3.2,and it has cash of $800 million.How much would it cost to take over this business assuming you pay its enterprise value?

What will be the effect on the balance sheet if a firm buys a new processing plant through a new loan?

Gross profit is calculated as

Cash is a

Convex Industries has inventories of $200 million,current assets of $1.4 billion,and current liabilities of $530 million.What is its quick ratio?