Exam 8: Analysis and Interpretation of Financial Statements

One ratio result on its own is meaningless unless it can be compared to an appropriate yardstick or benchmark.An appropriate benchmark would be

Which of the following statements relating to Net Tangible Asset Backing per share (NTAB)is correct?

The sum of the days inventory and the days debtors represents the entity's _____________ cycle.

A change in the inventory turnover period from 47 days to 51 days indicates:

What information would a financial institution contemplating giving a loan to an entity be most interested in?

Greenfields Pty Ltd has a quick asset ratio of 2 to 1 and current liabilities of $22 000.If Greenfields Pty Ltd has $10 000 of inventory,the total current assets is:

Days inventory is a measure of:

Financial statements are

_________________ analysis refers to analysing many aspects of an entity to assess the entity.

Earnings before interest and ________ divided by net interest equals the interest coverage ratio.

If marketing expenses to sales ratio is 4.2% in period 1 and 5.1% in period 2,this indicates that:

If Morgan Trading Pty Ltd has the following balance sheet figures the debt ratio is: \ Current assets 500000 Current liabilities 150000 Non-current assets 20000 Noncurrent liabilities 50000

The current ratio is a

In a vertical analysis,the base for prepaid expenses is

Earnings per share is calculated by dividing

For a retail firm the quick asset ratio will always be:

____________________ is the ability of a firm to meet its short term obligations as they fall due.

If year one equals $800,year two equals $830 and year three equals $896 the value given to year three in a trend analysis,with year one as the base year,is

The ratios used to evaluate the liquidity and short-term debt repaying ability of an entity are the current and ____________________asset ratios.

Horizontal analysis of financial statements includes the