Question 1

March Company's acid-test (quick)ratio at the end of Year 2 was closest to which of the following?

Accepted Answer

A)  0.39 to 1. 
B)  0.53 to 1. 
C)  0.95 to 1. 
D)  1.90 to 1. 
A)  0.39 to 1. 
B)  0.53 to 1. 
C)  0.95 to 1. 
D)  1.90 to 1.

Question 2

What is MK Company's return on common shareholders' equity for the current year,rounded to the nearest tenth of a percent?

Accepted Answer

A)  8.2%. 
B)  10.2%. 
C)  11.0%. 
D)  13.6%. 
A)  8.2%. 
B)  10.2%. 
C)  11.0%. 
D)  13.6%.

Question 3

The following data have been taken from your company's financial records for the current year:  
What is the price-earnings ratio?

Accepted Answer

A)  6.0 to 1. 
B)  7.5 to 1. 
C)  8.0 to 1. 
D)  12.5 to 1. 
A)  6.0 to 1. 
B)  7.5 to 1. 
C)  8.0 to 1. 
D)  12.5 to 1.

Question 4

Financial statements for Praeger Company appear below:

Dividends during Year 2 totalled $45,000,of which $10,000 were preferred dividends.The market price of a common share on December 31,Year 2 was $30.
The preferred shares are convertible to common shares on the basis of 2 common shares for each preferred share.
Required:
Calculate the following for Year 2:
a)Basic earnings per common share.
b)Fully diluted earnings per common share.
c)Price-earnings ratio (use basic earnings per share).
d)Dividend payout ratio (use basic earnings per share).
e)Dividend yield ratio.
f)Return on total assets.
g)Return on common shareholders' equity.
h)Book value per share.
i)Working capital.
j)Current ratio.
k)Acid-test (quick)ratio.
l. )Accounts receivable turnover.
m)Average collection period (age of receivables).
n)Inventory turnover.
o)Average sale period (turnover in days).
p)Times interest earned.
q)Debt-to-equity ratio.

Accepted Answer

a)Basic earnings per share = (Net income

Question 5

Larosa Company's dividend payout ratio for Year 2 was closest to which of the following?

Accepted Answer

A)  6.5%. 
B)  10.6%. 
C)  17.9%. 
D)  21.7%. 
A)  6.5%. 
B)  10.6%. 
C)  17.9%. 
D)  21.7%.

Question 6

Marcell Company's average collection period (age of receivables)for Year 2 was closest to which of the following?

Accepted Answer

A)  15.7 days. 
B)  22.6 days. 
C)  25.8 days. 
D)  36.9 days. 
A)  15.7 days. 
B)  22.6 days. 
C)  25.8 days. 
D)  36.9 days.

Question 7

Dratif Company's working capital is $33,000,and its current liabilities are $80,000.The company's current ratio is closest to which of the following?

Accepted Answer

A)  0.41 to 1. 
B)  0.59 to 1. 
C)  1.41 to 1. 
D)  3.42 to 1. 
A)  0.41 to 1. 
B)  0.59 to 1. 
C)  1.41 to 1. 
D)  3.42 to 1.

Question 8

Harton Company,a retailer,had cost of goods sold of $250,000 last year.The beginning inventory balance was $20,000,and the ending inventory balance was $22,000.The company's inventory turnover was closest to which of the following?

Accepted Answer

A)  5.95 times. 
B)  11.36 times. 
C)  11.90 times. 
D)  12.50 times. 
A)  5.95 times. 
B)  11.36 times. 
C)  11.90 times. 
D)  12.50 times.

Question 9

Rahner Company has a current ratio of 1.75 to 1.This ratio will decrease if Rahner Company engages in which of the following transactions?

Accepted Answer

A)  Borrows cash using a six-month note. 
B)  Pays the taxes payable that have been a current liability. 
C)  Pays the following month's rent on the last day of the year. 
D)  Sells inventory for more than its cost. 
A)  Borrows cash using a six-month note. 
B)  Pays the taxes payable that have been a current liability. 
C)  Pays the following month's rent on the last day of the year. 
D)  Sells inventory for more than its cost.

Question 10

The market price of XYZ Company's common shares dropped from $25 to $21 per share.The dividend paid per share remained unchanged.How would the company's dividend payout ratio change?

Accepted Answer

A)  Increase. 
B)  Decrease. 
C)  Remain unchanged. 
D)  Impossible to determine without more information. 
A)  Increase. 
B)  Decrease. 
C)  Remain unchanged. 
D)  Impossible to determine without more information.

Question 11

Marcell Company's current ratio at the end of Year 2 was closest to which of the following?

Accepted Answer

A)  0.42 to 1. 
B)  0.48 to 1. 
C)  1.04 to 1. 
D)  1.22 to 1. 
A)  0.42 to 1. 
B)  0.48 to 1. 
C)  1.04 to 1. 
D)  1.22 to 1.

Question 12

Condensed financial statements of Miller Company at the beginning and at the end of the current year are given below:

The company paid total dividends of $15,000 during the year,of which $5,000 were to preferred shareholders.The market price of a common share at the end of the year was $30.
Required:
On the basis of the information given above,fill in the blanks with the appropriate figures.
Example: The current ratio at the end of the current year would be computed by dividing $270,000 by $100,000.
a)The acid-test (quick)ratio at the end of the current year would be computed by dividing _______________ by ________________.
b)The inventory turnover for the year would be computed by dividing _______________ by ________________.
c)The debt-to-equity ratio at the end of the current year would be computed by dividing _______________ by ________________.
d)The earnings per common share would be computed by dividing _______________ by ________________.
e)The accounts receivable turnover for the year would be computed by dividing _______________ by ________________.
f)The times interest earned for the year would be computed by dividing _______________ by ________________.
g)The return on common shareholders' equity for the year would be computed by dividing _______________ by ________________.
h)The dividend yield would be computed by dividing _______________ by ________________.

Accepted Answer

a)$120,000;$100,000.
b)$350,00

Question 13

If a company converts a short-term note payable into a long-term note payable,what would be the effect of this transaction?

Accepted Answer

A)  A decrease in working capital and an increase in the current ratio. 
B)  A decrease in both working capital and the current ratio. 
C)  A decrease in both the current ratio and the acid-test ratio. 
D)  An increase in both working capital and the current ratio. 
A)  A decrease in working capital and an increase in the current ratio. 
B)  A decrease in both working capital and the current ratio. 
C)  A decrease in both the current ratio and the acid-test ratio. 
D)  An increase in both working capital and the current ratio.

Question 14

Oratz Company's current ratio at the end of Year 2 was closest to which of the following?

Accepted Answer

A)  0.51 to 1. 
B)  0.57 to 1. 
C)  1.23 to 1. 
D)  1.26 to 1. 
A)  0.51 to 1. 
B)  0.57 to 1. 
C)  1.23 to 1. 
D)  1.26 to 1.

Question 15

Grapp Company had $130,000 in sales on account last year.The beginning accounts receivable balance was $18,000,and the ending accounts receivable balance was $16,000.The company's average collection period (age of receivables)was closest to which of the following? Do not round intermediate calculations.

Accepted Answer

A)  44.92 days. 
B)  47.73 days. 
C)  50.54 days. 
D)  95.46 days. 
A)  44.92 days. 
B)  47.73 days. 
C)  50.54 days. 
D)  95.46 days.

Question 16

Curry Company's average collection period (age of receivables)for Year 2 was closest to which of the following?

Accepted Answer

A)  30.4 days. 
B)  40.6 days. 
C)  50.7 days. 
D)  60.8 days. 
A)  30.4 days. 
B)  40.6 days. 
C)  50.7 days. 
D)  60.8 days.

Question 17

Oratz Company's earnings per common share for Year 2 was closest to which of the following? Do not round intermediate calculations.

Accepted Answer

A)  $1.74. 
B)  $19.61. 
C)  $20.25. 
D)  $28.93. 
A)  $1.74. 
B)  $19.61. 
C)  $20.25. 
D)  $28.93.

Question 18

Narumi Company's debt-to-equity ratio at the end of Year 2 was closest to which of the following?

Accepted Answer

A)  0.42 to 1. 
B)  0.56 to 1. 
C)  0.98 to 1. 
D)  2.07 to 1. 
A)  0.42 to 1. 
B)  0.56 to 1. 
C)  0.98 to 1. 
D)  2.07 to 1.

Question 19

Braverman Company's net income last year was $75,000,and its interest expense was $10,000.Total assets at the beginning of the year were $650,000,and total assets at the end of the year were $610,000.The company's income tax rate was 30%.The company's return on total assets for the year was closest to which of the following?

Accepted Answer

A)  11.9%. 
B)  12.4%. 
C)  13.0%. 
D)  13.5%. 
A)  11.9%. 
B)  12.4%. 
C)  13.0%. 
D)  13.5%.

Question 20

Dragin Company's working capital is $36,000,and its current liabilities are $61,000.The company's current ratio is closest to which of the following?

Accepted Answer

A)  0.41 to 1. 
B)  0.59 to 1. 
C)  1.59 to 1. 
D)  2.69 to 1. 
A)  0.41 to 1. 
B)  0.59 to 1. 
C)  1.59 to 1. 
D)  2.69 to 1.

March Company's acid-test (quick)ratio at the end of Year 2 was closest to which of the following?

What is MK Company's return on common shareholders' equity for the current year,rounded to the nearest tenth of a percent?

The following data have been taken from your company's financial records for the current year: What is the price-earnings ratio?

Larosa Company's dividend payout ratio for Year 2 was closest to which of the following?

Marcell Company's average collection period (age of receivables)for Year 2 was closest to which of the following?

Dratif Company's working capital is $33,000,and its current liabilities are $80,000.The company's current ratio is closest to which of the following?

Harton Company,a retailer,had cost of goods sold of $250,000 last year.The beginning inventory balance was $20,000,and the ending inventory balance was $22,000.The company's inventory turnover was closest to which of the following?

Rahner Company has a current ratio of 1.75 to 1.This ratio will decrease if Rahner Company engages in which of the following transactions?

The market price of XYZ Company's common shares dropped from $25 to $21 per share.The dividend paid per share remained unchanged.How would the company's dividend payout ratio change?

Marcell Company's current ratio at the end of Year 2 was closest to which of the following?

If a company converts a short-term note payable into a long-term note payable,what would be the effect of this transaction?

Oratz Company's current ratio at the end of Year 2 was closest to which of the following?

Curry Company's average collection period (age of receivables)for Year 2 was closest to which of the following?

Oratz Company's earnings per common share for Year 2 was closest to which of the following? Do not round intermediate calculations.

Narumi Company's debt-to-equity ratio at the end of Year 2 was closest to which of the following?

Dragin Company's working capital is $36,000,and its current liabilities are $61,000.The company's current ratio is closest to which of the following?

Managerial Accounting and the Business Environment

Cost Terms, Concepts, and Classifications

Cost Behaviour: Analysis and Use

Cost-Volume-Profit Relationships

Systems Design: Job-Order Costing

Systems Design: Process Costing

Activity-Based Costing: a Tool to Aid Decision Making

Variable Costing: a Tool for Management

Budgeting

Standard Costs and Overhead Analysis

Reporting for Control

Relevant Costs for Decision Making

Capital Budgeting Decisions

Filters

Exam 14: Financial Statement Analysis Online

March Company's acid-test (quick)ratio at the end of Year 2 was closest to which of the following?

What is MK Company's return on common shareholders' equity for the current year,rounded to the nearest tenth of a percent?

The following data have been taken from your company's financial records for the current year: What is the price-earnings ratio?

Larosa Company's dividend payout ratio for Year 2 was closest to which of the following?

Marcell Company's average collection period (age of receivables)for Year 2 was closest to which of the following?

Dratif Company's working capital is $33,000,and its current liabilities are $80,000.The company's current ratio is closest to which of the following?

Harton Company,a retailer,had cost of goods sold of $250,000 last year.The beginning inventory balance was $20,000,and the ending inventory balance was $22,000.The company's inventory turnover was closest to which of the following?

Rahner Company has a current ratio of 1.75 to 1.This ratio will decrease if Rahner Company engages in which of the following transactions?

The market price of XYZ Company's common shares dropped from $25 to $21 per share.The dividend paid per share remained unchanged.How would the company's dividend payout ratio change?

Marcell Company's current ratio at the end of Year 2 was closest to which of the following?

If a company converts a short-term note payable into a long-term note payable,what would be the effect of this transaction?

Oratz Company's current ratio at the end of Year 2 was closest to which of the following?

Curry Company's average collection period (age of receivables)for Year 2 was closest to which of the following?

Oratz Company's earnings per common share for Year 2 was closest to which of the following? Do not round intermediate calculations.

Narumi Company's debt-to-equity ratio at the end of Year 2 was closest to which of the following?

Dragin Company's working capital is $36,000,and its current liabilities are $61,000.The company's current ratio is closest to which of the following?

Managerial Accounting and the Business Environment

Cost Terms, Concepts, and Classifications

Cost Behaviour: Analysis and Use

Cost-Volume-Profit Relationships

Systems Design: Job-Order Costing

Systems Design: Process Costing

Activity-Based Costing: a Tool to Aid Decision Making

Variable Costing: a Tool for Management

Budgeting

Standard Costs and Overhead Analysis

Reporting for Control

Relevant Costs for Decision Making

Capital Budgeting Decisions

Filters