Exam 9: Financial Statement Analysis

The tendency of the rate earned on stockholders' equity to vary disproportionately from the rate earned on total assets is sometimes referred as:

Based on the following data for the current year, determine the number of days' sales in accounts receivable? \ 1,095,000 Net sales on account during the year 700,000 Cost of merchandise sold during the yeat 47,500 Accounts receivable, be ginning of year 37,500 Accounts receivable, end of year 190,000 Inventory, be ginning of year 220,000 Inventory, end of year

Based on the following data for the current year, determine the inventory turnover? \ 517,500 Net sales on account during the year 450,000 Cost of merchandise sold during the yeat 50,000 Accounts receivable, be ginning of year 40,000 Accounts receivable, end of year 110,000 Inventory, be ginning of year 140,000 Inventory, end of year

Statements in which all items are expressed as percentages with no dollar amounts are called common-sized statements.

The ratio of the market price per share of common stock on a specific date to the annual earnings per share is referred to as the price-earnings ratio.

Washington Corporation has the following financial data for 2013 and 2012. 2012 2013 ASSSETS Curent Assets: 9,000 \ 37,000 Cash 11,000 8,000 Marketable Securities 25,000 32,000 Accounts Receivable 10,000 13,000 Other Current Assets 55,000 90,000 Total Current Assets 120,000 135,000 Fixed Assets(net) \ 175,000 \ 225,000 Total Assets Liabilities \ 40,000 \ 71,000 Curent Liabilities 35,000 34,000 Long-term Liabilities \ 75,000 \ 105,000 Total Libilities \ 100,000 \ 120,000 Total Stocklohlers'Equity \ 175,000 \ 225,000 Total Linbilities And StockJolders' Equity What is Washington's current ratio for 2013?

Which of the following is not an analysis used in assessing solvency?

The number of times interest charges are earned is computed as:

The percent of fixed assets to total assets is an example of:

The rate earned on total common stockholders' equity for most thriving businesses will be less than the rate earned on total assets.

For most profitable companies, the rate earned on total assets will be less than:

The balance sheet and income statement for the year ended 2013 indicate the following: \ 1,000,000 Bonds payable, 12\% (issued 1998, due 2022) 300,000 Preferred 5\% stock, \ 100 par (no change during year) 2,000,000 Common stock, \ 50 par (no change during year) 300,000 Income before income tax for year 80,000 Income tax for year 50,000 Common dividendspaid 15,000 Preferred dividendspaid Based on the data presented above, what is the number of times interest charges were earned?

Based on the following data for the current year, determine the accounts receivable turnover? \ 500,000 Net sales on account during the year 300,000 Cost of merchandise sold during the yeat 45,000 Accounts receivable, be ginning of year 35,000 Accounts receivable, end of year 90,000 Inventory, be ginning of year 110,000 Inventory, end of year

Which of the following cannot be used to assess solvency of a company?

The number of days' sales in inventory is one means of expressing the relationship between net sales and accounts receivable.

Based on the following data for the current year, determine the accounts receivable turnover? \ 525,500 Net sales on account during the year 375,000 Cost of merchandise sold during the yeat 50,000 Accounts receivable, be ginning of year 40,000 Accounts receivable, end of year 110,000 Inventory, be ginning of year 140,000 Inventory, end of year

The percentage analysis of increases and decreases in corresponding items in comparative financial statements is referred to as horizontal analysis.

Which of the following is included in the computation of the quick ratio?

The balance sheets at the end of each of the first two years of operations indicate the following: 2012 2013 \ 560,000 \ 600,000 Total current assets 40,000 60,000 Total investments 700,000 900,000 Total property, plant, and ecuipment 80,000 125,000 Total current liabilities 250,000 350,000 Total long-term liabilities 100,000 100,000 Preferred 9\% stock \ 100 600,000 600,000 Common stock, \ 10 prr 60,000 60,000 Paid-in capital in excess of par--common stock 210,000 325,000 Retained earnings Based on the above information, if net income is $130,000 and interest expense is $40,000 for 2013, what is the rate earned on stockholders' equity for 2013 (round to one decimal place)?

Thomson Company reported the following on its income statement: \ 420,000 Income before income taxes 120,000 Income tax expense \ 300,000 Net income An analysis of the income statement revealed that interest expense was $40,000. Thomson Company's number of times interest charges are earned was: