Question 1

For financial information to be useful it $\bold{must}$ possess the following characteristics:

Accepted Answer

A) Must be relevant and faithfully represent the underlying business. 
B) Must be faithful and accurate. 
C) Must be timely and verifiable. 
D) Must be relevant and comparable 
A) Must be relevant and faithfully represent the underlying business. 
B) Must be faithful and accurate. 
C) Must be timely and verifiable. 
D) Must be relevant and comparable

Question 2

A times interest earned ratio of 11 means that the company's:

Accepted Answer

A) net income is large enough to pay interest and taxes 11 times. 
B) net cash flow from operations before taxes and interest is large enough to pay interest 11 times. 
C) net cash flow from operations is large enough to pay interest and taxes 11 times. 
D) net income before taxes and interest is large enough to pay interest 11 times. 
A) net income is large enough to pay interest and taxes 11 times. 
B) net cash flow from operations before taxes and interest is large enough to pay interest 11 times. 
C) net cash flow from operations is large enough to pay interest and taxes 11 times. 
D) net income before taxes and interest is large enough to pay interest 11 times.

Question 3

The financial information below presents selected information from the financial statements of Pelican Company.Sales revenue in 2018 was $13,700,300.
 $$\begin{array} { | l | r | r | } 
& 1 / 1 / 18 & \mathbf { 1 2 / 3 1 / 1 8 } \
\hline \text { Accourts receivable } & \$ 4,550,000 & \mathbf { \$ 3 , 8 0 0 , 0 0 0 } \
\hline \text { Total current assets } & \mathbf { 8 } , 700,030 & \mathbf { 8 , 4 8 0 , 1 0 0 } \
\hline \text { Total assets } & 11,100,020 & 10,980,000 \
\hline \text { Total currert liabilities } & 7,200,300 & 7,476,000 \
\hline \text { Total liabilities } & \mathbf { 8 , 4 4 9 , 9 0 0 } & \mathbf { 8 , 2 7 0 , 7 0 0 } \
\hline
\end{array}$$ 
A.Receivables turnover assuming all Pelican's sales are made on account.
B.Receivables turnover assuming 20% of sales are made as cash sales.
C.Current ratio as of December 31,2018.
D.Debt-to-assets ratio as of December 31,2018.

Accepted Answer

Calculate:
A.Receivables turnover assumi

Question 4

If a company's P/E ratio is 24 and the company's EPS is $1.50 then the company's share price is:

Accepted Answer

A) $36.00. 
B) $25.50. 
C) $16.00. 
D) $6.25. 
A) $36.00. 
B) $25.50. 
C) $16.00. 
D) $6.25.

Question 5

If an analyst wants to examine a company's current ability to generate income,which of the following would best be considered?

Accepted Answer

A) Liquidity 
B) Market share 
C) Profitability 
D) Solvency 
A) Liquidity 
B) Market share 
C) Profitability 
D) Solvency

Question 6

$\begin{array}{llcc}
  \text { Net sales reverue } &\$345,000  \
 \text {Cost of goods sold  } &\$205,000\
 \text { Average accourts receivable } &\$32,500\
 \text { Average irventory } &\$9,450\
 \text { Average plart, property ard equipment } &\$81,250\
 \text { Average total assets } &\$130,000\
\end{array}$
 
-According to the above table.Calculate the company's days to sell ratio for the current year?

Accepted Answer

A) 16.83 
B) 21.69 
C) 5.94 
D) 26.53 
A) 16.83 
B) 21.69 
C) 5.94 
D) 26.53

Question 7

Factors revealed by financial analysis as contributing to going-concern problems include all of the following except,

Accepted Answer

A) Significant one-time expenses. 
B) Insufficient current assets. 
C) Insufficient product innovation. 
D) Declining sales. 
A) Significant one-time expenses. 
B) Insufficient current assets. 
C) Insufficient product innovation. 
D) Declining sales.

Question 8

Both liquidity ratios and solvency ratios measure a company's ability to meet its financial obligations.

Accepted Answer

A) True 
 B)False

Question 9

The analysis of a firm's liquidity includes all of the following except,

Accepted Answer

A) Current ratio. 
B) Receivables turnover. 
C) Inventory turnover. 
D) Fixed Asset turnover. 
A) Current ratio. 
B) Receivables turnover. 
C) Inventory turnover. 
D) Fixed Asset turnover.

Question 10

Let's assume for the year ended February 1,2018,that Rowna Inc reported net income of $2.2 billion on sales of $71.3 billion.If the company's cost of sales that year was $47.3 billion,what was the company's gross profit percentage and net profit margin? If sales were $77.3 billion in the prior year,what was the year-over-year percentage decrease in the most recent year?

Accepted Answer

Gross Profit % = [($71.3 - $47

Question 11

Match between columns
                        Premises: Debt-to-Assets Ratio
ROE
Inventory Turnover Ratio
Times interest earned Ratio
Net Profit Margin
EPS

Accepted Answer

The Answer of Total Assets and Net Sales Revenue and is...

Question 12

Trend data can be measured in dollar amounts or percentages.

Accepted Answer

A) True 
 B)False

Question 13

If net income is rising,but both sales and the gross profit percentage remain the same,then:

Accepted Answer

A) operating expenses are falling. 
B) operating expenses are rising. 
C) cost of goods sold is falling. 
D) cost of goods sold is rising. 
A) operating expenses are falling. 
B) operating expenses are rising. 
C) cost of goods sold is falling. 
D) cost of goods sold is rising.

Question 14

Which non-financial factor in the following list is most likely to be a cause of a going-concern problem?

Accepted Answer

A) Hiring a new CEO. 
B) Loss of a key patent. 
C) Announcing a new share issue. 
D) Replacing an old product line. 
A) Hiring a new CEO. 
B) Loss of a key patent. 
C) Announcing a new share issue. 
D) Replacing an old product line.

Question 15

Judging only from the ratios given,which of the following clothing wholesalers is least likely to have cash flow problems?

Accepted Answer

A) Company A,who has a receivables turnover of 5,and an inventory turnover of 2 
B) Company B,who has a receivables turnover of 2,and an inventory turnover of 5 
C) Company C,who has a receivables turnover of 10,and an inventory turnover of 10 
D) Company D,who has a receivables turnover of 1,and an inventory turnover of 1 
A) Company A,who has a receivables turnover of 5,and an inventory turnover of 2 
B) Company B,who has a receivables turnover of 2,and an inventory turnover of 5 
C) Company C,who has a receivables turnover of 10,and an inventory turnover of 10 
D) Company D,who has a receivables turnover of 1,and an inventory turnover of 1

Question 16

If a company's P/E ratio suddenly decreases:

Accepted Answer

A) you should sell the shares as soon as possible. 
B) you should buy more of the shares to increase your average gain. 
C) the company probably announced higher earnings forecasts. 
D) the market must have reacted to some bad news that is expected to affect the company in the future. 
A) you should sell the shares as soon as possible. 
B) you should buy more of the shares to increase your average gain. 
C) the company probably announced higher earnings forecasts. 
D) the market must have reacted to some bad news that is expected to affect the company in the future.

Question 17

If you wish to examine the relationships among various items reported in one or more of the financial statements,you are most likely to use:

Accepted Answer

A) time-series analysis. 
B) ratio analysis. 
C) horizontal analysis. 
D) cross-sectional analysis. 
A) time-series analysis. 
B) ratio analysis. 
C) horizontal analysis. 
D) cross-sectional analysis.

Question 18

A current ratio of less than one is not so much of a concern when the company has a:

Accepted Answer

A) low fixed asset turnover ratio. 
B) high days to collect number. 
C) high inventory turnover ratio. 
D) all of the answers are acceptable. 
A) low fixed asset turnover ratio. 
B) high days to collect number. 
C) high inventory turnover ratio. 
D) all of the answers are acceptable.

Question 19

Vertical analysis is one means of analyzing change over time.

Accepted Answer

A) True 
 B)False

Question 20

During the current accounting period,revenue from credit sales is $671,000.The accounts receivable balance is $51,480 at the beginning of the period and $52,200 at the end of the period.Which of the following statements is true?

Accepted Answer

A) The receivables turnover ratio is 12.9. 
B) On average,it takes 12.9 days to collect payment from credit customers. 
C) The receivables turnover ratio is 28.3. 
D) On average,the company sells its inventory every 28.4 days. 
A) The receivables turnover ratio is 12.9. 
B) On average,it takes 12.9 days to collect payment from credit customers. 
C) The receivables turnover ratio is 28.3. 
D) On average,the company sells its inventory every 28.4 days.

For financial information to be useful it $\bold{must}$ possess the following characteristics:

A times interest earned ratio of 11 means that the company's:

If a company's P/E ratio is 24 and the company's EPS is $1.50 then the company's share price is:

If an analyst wants to examine a company's current ability to generate income,which of the following would best be considered?

Net sales reverue \3 45,000 Cost of goods sold \2 05,000 Average accourts receivable \3 2,500 Average irventory \9 ,450 Average plart, property ard equipment \8 1,250 Average total assets \1 30,000 -According to the above table.Calculate the company's days to sell ratio for the current year?

Factors revealed by financial analysis as contributing to going-concern problems include all of the following except,

Both liquidity ratios and solvency ratios measure a company's ability to meet its financial obligations.

The analysis of a firm's liquidity includes all of the following except,

Trend data can be measured in dollar amounts or percentages.

If net income is rising,but both sales and the gross profit percentage remain the same,then:

Which non-financial factor in the following list is most likely to be a cause of a going-concern problem?

Judging only from the ratios given,which of the following clothing wholesalers is least likely to have cash flow problems?

If a company's P/E ratio suddenly decreases:

If you wish to examine the relationships among various items reported in one or more of the financial statements,you are most likely to use:

A current ratio of less than one is not so much of a concern when the company has a:

Vertical analysis is one means of analyzing change over time.

During the current accounting period,revenue from credit sales is $671,000.The accounts receivable balance is $51,480 at the beginning of the period and $52,200 at the end of the period.Which of the following statements is true?

Business Decisions and Financial Accounting

The Balance Sheet

The Income Statement

Adjustments, financial Statements, and Financial Results

Fraud, internal Control, and Cash

Merchandising Operations and the Multi-Step Income Statement

Inventory and Cost of Goods Sold

Receivables, bad Debt Expense, and Interest Revenue

Long-Lived Tangible and Intangible Assets

Liabilities

Shareholders Equity

Statement of Cash Flows

Filters

Exam 13: Measuring and Evaluating Financial Performance

For financial information to be useful it must\bold{must}must possess the following characteristics:

A times interest earned ratio of 11 means that the company's:

If a company's P/E ratio is 24 and the company's EPS is $1.50 then the company's share price is:

If an analyst wants to examine a company's current ability to generate income,which of the following would best be considered?

Net sales reverue \3 45,000 Cost of goods sold \2 05,000 Average accourts receivable \3 2,500 Average irventory \9 ,450 Average plart, property ard equipment \8 1,250 Average total assets \1 30,000 -According to the above table.Calculate the company's days to sell ratio for the current year?

Factors revealed by financial analysis as contributing to going-concern problems include all of the following except,

Both liquidity ratios and solvency ratios measure a company's ability to meet its financial obligations.

The analysis of a firm's liquidity includes all of the following except,

Trend data can be measured in dollar amounts or percentages.

If net income is rising,but both sales and the gross profit percentage remain the same,then:

Which non-financial factor in the following list is most likely to be a cause of a going-concern problem?

Judging only from the ratios given,which of the following clothing wholesalers is least likely to have cash flow problems?

If a company's P/E ratio suddenly decreases:

If you wish to examine the relationships among various items reported in one or more of the financial statements,you are most likely to use:

A current ratio of less than one is not so much of a concern when the company has a:

Vertical analysis is one means of analyzing change over time.

During the current accounting period,revenue from credit sales is $671,000.The accounts receivable balance is $51,480 at the beginning of the period and $52,200 at the end of the period.Which of the following statements is true?

Business Decisions and Financial Accounting

The Balance Sheet

The Income Statement

Adjustments, financial Statements, and Financial Results

Fraud, internal Control, and Cash

Merchandising Operations and the Multi-Step Income Statement

Inventory and Cost of Goods Sold

Receivables, bad Debt Expense, and Interest Revenue

Long-Lived Tangible and Intangible Assets

Liabilities

Shareholders Equity

Statement of Cash Flows

Filters

For financial information to be useful it $\bold{must}$ possess the following characteristics: