Exam 3: Financial Statements and Ratio Analysis

Table 3.2 Dana Dairy Products Key Ratios Income Statement Dana Dairy Products For the Year Ended December 31,2019 Balance Sheet Dana Dairy Products December 31,2019 -The inventory management at Dana Dairy Products ________ since 2018.(See Table 3.2)

The Financial Accounting Standards Board (FASB)is the federal regulatory body that governs the sale and listing of securities.

Earnings per share represents the dollar amount earned and distributed to shareholders.

The average age of inventory can be calculated as inventory turnover divided by 365.

The ________ represents a summary statement of a firm's financial position at a given point in time.

The Public Company Accounting Oversight Board (PCAOB)________.

All other things being equal,a firm's P/E ratio will be lower if investors think the firm's growth prospects are very good.

The P/E ratio measures the ________.

Sunshine Corporation had a retained earnings balance of $850,000 at the beginning of 2019.By the end of 2019,the company's retained earnings balance stood at $950,000.During 2019,the company earned $245,000 as net profits after paying its taxes.The company was then able to pay its preferred stockholders a sum of $45,000.Compute the common stock dividend per share in 2019 assuming 10,000 shares of common stock outstanding.

If a firm has no liabilities or debt of any kind on its balance sheet,then which of the following is TRUE?

Table 3.2 Dana Dairy Products Key Ratios Income Statement Dana Dairy Products For the Year Ended December 31,2019 Balance Sheet Dana Dairy Products December 31,2019 -The average collection period for Dana Dairy Products in 2019 was ________.(See Table 3.2)

The balance sheet is a statement which balances a firm's assets (what it owns)against its debt (what it owes)and its equity (what is provided by owners).

The two basic measures of liquidity are the debt-to-equity ratio and the asset turnover ratio.

Retained earnings represent the cumulative total of all earnings,net of dividends,that have been retained and reinvested in the firm since its inception.

Paid-in capital in excess of par represents the amount of proceeds ________.

Which of the following is excluded when calculating the quick ratio?

Cross-sectional ratio analysis is used to ________.

The lower the fixed-payment coverage ratio,the lower is the firm's financial leverage.

At the end of 2019,Long Life Light Bulb Corporation announced a gross profit of $1 million.The company has also established that over the course of this year that it has incurred $345,000 in operating expenses and $125,000 in interest expenses.The company is subject to a 21% tax rate and has declared $57,000 of total preferred stock dividends. (a)Calculate the earnings available for common stockholders? (b)Compute the increased retained earnings for 2019 if the company were to declare a $4.25 common stock dividend.The company has 15,000 shares of common stock outstanding.

When preparing the retained earnings statement,________ is(are)subtracted in order to derive at the ending balance of retained earnings.