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Deck 14: Financial Statement Analysis
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Question
Question
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A company reported the following amounts of net income:
- Which of the following is the percentage change in net income from 2007 to 2008?
A) 2.00%
B) 10.00%
C) 8.33%
D) 7.69%
- Which of the following is the percentage change in net income from 2007 to 2008?
A) 2.00%
B) 10.00%
C) 8.33%
D) 7.69%
Question
A company reported the following amounts of net income:
- Which of the following is the percentage change in net income from 2006 to 2007?
A) 33.33%
B) 8.33%
C) 10.00%
D) 30.00%
- Which of the following is the percentage change in net income from 2006 to 2007?
A) 33.33%
B) 8.33%
C) 10.00%
D) 30.00%
Question
The following is a summary of information presented on the financial statements of The Cake Company on December 31, 2007.
-What would horizontal analysis report with respect to net income before income tax expense and net income?
A) Horizontal analysis would report both net income before income tax expense and net income as 45.45% of net sales revenue.
B) Horizontal analysis would report a $25,000 increase in both net income before income tax expense and net income.
C) Horizontal analysis would report a 45.45% increase in both net income before income tax expense and net income.
D) None of the above is correct.
-What would horizontal analysis report with respect to net income before income tax expense and net income?
A) Horizontal analysis would report both net income before income tax expense and net income as 45.45% of net sales revenue.
B) Horizontal analysis would report a $25,000 increase in both net income before income tax expense and net income.
C) Horizontal analysis would report a 45.45% increase in both net income before income tax expense and net income.
D) None of the above is correct.
Question
The following is a summary of information presented on the financial statements of The Cake Company on December 31, 2007.
- What would horizontal analysis report with respect to common stock?
A) Horizontal analysis would report stockholders' equity as 25.64% of total capital.
B) Horizontal analysis would report a dividend yield of $8.20.
C) Horizontal analysis would report a rate of return on stockholders' equity of $11.20.
D) Horizontal analysis would report a 25% increase in common stock.
- What would horizontal analysis report with respect to common stock?
A) Horizontal analysis would report stockholders' equity as 25.64% of total capital.
B) Horizontal analysis would report a dividend yield of $8.20.
C) Horizontal analysis would report a rate of return on stockholders' equity of $11.20.
D) Horizontal analysis would report a 25% increase in common stock.
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The following is a summary of information presented on the income statement of HR Flowers for December 31, 2007.
- What would vertical analysis report with respect to 2007 net income before income tax and income tax expense?
A) Vertical analysis would report net income before income tax as 17.86% and income tax expense as 4.93% of net sales revenue.
B) Vertical analysis would report a 58.18% increase in both net income before income tax and income tax expense.
C) Vertical analysis would report a $32,000 increase in both net income before income tax and income tax expense.
D) None of the above is correct.
- What would vertical analysis report with respect to 2007 net income before income tax and income tax expense?
A) Vertical analysis would report net income before income tax as 17.86% and income tax expense as 4.93% of net sales revenue.
B) Vertical analysis would report a 58.18% increase in both net income before income tax and income tax expense.
C) Vertical analysis would report a $32,000 increase in both net income before income tax and income tax expense.
D) None of the above is correct.
Question
The following is a summary of information presented on the income statement of HR Flowers for December 31, 2007.
-What would vertical analysis report with respect to 2007 net sales revenue?
A) Vertical analysis would report cost of goods sold as 79.19% of net sales revenue.
B) Vertical analysis would report a dividend yield of $8.20.
C) Vertical analysis would report net sales revenue as the 100% base amount.
D) Vertical analysis would report a 2.60% decrease in net sales revenue.
-What would vertical analysis report with respect to 2007 net sales revenue?
A) Vertical analysis would report cost of goods sold as 79.19% of net sales revenue.
B) Vertical analysis would report a dividend yield of $8.20.
C) Vertical analysis would report net sales revenue as the 100% base amount.
D) Vertical analysis would report a 2.60% decrease in net sales revenue.
Question
The following is a summary of information presented on the income statement of HR Flowers for December 31, 2007.
- What would vertical analysis report with respect to 2007 selling and general expenses?
A) Vertical analysis would report a 40.00% increase in selling and general expenses.
B) Vertical analysis would report a 40.00% decrease in selling and general expenses.
C) Vertical analysis would report selling and general expenses as 14.37% of net sales revenue.
D) Vertical analysis would report selling and general expenses as 10.00% of net sales revenue.
- What would vertical analysis report with respect to 2007 selling and general expenses?
A) Vertical analysis would report a 40.00% increase in selling and general expenses.
B) Vertical analysis would report a 40.00% decrease in selling and general expenses.
C) Vertical analysis would report selling and general expenses as 14.37% of net sales revenue.
D) Vertical analysis would report selling and general expenses as 10.00% of net sales revenue.
Question
The following is a summary of information presented on the income statement of HR Flowers for December 31, 2007.
- What would vertical analysis report with respect to the relationship between 2007 net sales revenue and cost of goods sold?
A) Vertical analysis would report that cost of goods sold was too high as a percentage of net sales revenue.
B) Vertical analysis would report that cost of goods sold was 67.76% of net sales revenue.
C) Vertical analysis would report that cost of goods sold increased more than net sales revenue.
D) Vertical analysis would report that cost of goods sold was too low as a percentage of net sales revenue.
- What would vertical analysis report with respect to the relationship between 2007 net sales revenue and cost of goods sold?
A) Vertical analysis would report that cost of goods sold was too high as a percentage of net sales revenue.
B) Vertical analysis would report that cost of goods sold was 67.76% of net sales revenue.
C) Vertical analysis would report that cost of goods sold increased more than net sales revenue.
D) Vertical analysis would report that cost of goods sold was too low as a percentage of net sales revenue.
Question
The following is a summary of information presented on the income statement of HR Flowers for December 31, 2007.
-What would vertical analysis report with respect to 2007 income tax expense?
A) Vertical analysis would report a $7,500 increase income tax expense.
B) Vertical analysis would report income tax expense as 4.93% of net sales revenue.
C) Vertical analysis would report a 45.45% increase in income tax expense.
D) Vertical analysis would report income tax expense as 27.59% of net income before income tax.
-What would vertical analysis report with respect to 2007 income tax expense?
A) Vertical analysis would report a $7,500 increase income tax expense.
B) Vertical analysis would report income tax expense as 4.93% of net sales revenue.
C) Vertical analysis would report a 45.45% increase in income tax expense.
D) Vertical analysis would report income tax expense as 27.59% of net income before income tax.
Question
What type of analysis is illustrated in the following table?
A) The table illustrates a common-size balance sheet
B) The table illustrates vertical analysis.
C) The table illustrates benchmarking.
D) The table illustrates horizontal analysis.
A) The table illustrates a common-size balance sheet
B) The table illustrates vertical analysis.
C) The table illustrates benchmarking.
D) The table illustrates horizontal analysis.
Question
The following is a summary of information presented on the income statements of Haley Publications and Johnston Publications for December 31, 2007.
- Which company has the better relationship between selling and general expenses and net sales revenue?
A) It is impossible to determine which company has the better relationship between selling and general expenses and net sales revenue using the information presented.
B) The companies have the same relationship between selling and general expenses and net sales revenue.
C) Johnston Company has the better relationship between selling and general expenses and net sales revenue.
D) Haley Company has the better relationship between selling and general expenses and net sales revenue.
- Which company has the better relationship between selling and general expenses and net sales revenue?
A) It is impossible to determine which company has the better relationship between selling and general expenses and net sales revenue using the information presented.
B) The companies have the same relationship between selling and general expenses and net sales revenue.
C) Johnston Company has the better relationship between selling and general expenses and net sales revenue.
D) Haley Company has the better relationship between selling and general expenses and net sales revenue.
Question
The following is a summary of information presented on the income statements of Haley Publications and Johnston Publications for December 31, 2007.
- Which company has the better relationship between gross profit and net sales revenue?
A) The companies have the same relationship between gross profit and net sales revenue.
B) Haley Company has the better relationship between gross profit and net sales revenue.
C) Johnston Company has the better relationship between gross profit and net sales revenue.
D) It is impossible to determine which company has the better relationship between gross profit and net sales revenue using the information presented.
- Which company has the better relationship between gross profit and net sales revenue?
A) The companies have the same relationship between gross profit and net sales revenue.
B) Haley Company has the better relationship between gross profit and net sales revenue.
C) Johnston Company has the better relationship between gross profit and net sales revenue.
D) It is impossible to determine which company has the better relationship between gross profit and net sales revenue using the information presented.
Question
The following is a summary of information presented on the income statements of Haley Publications and Johnston Publications for December 31, 2007.
- Which company has the better relationship between net income and net sales revenue?
A) Johnston Company has the better relationship between net income and net sales revenue.
B) Haley Company has the better relationship net income and net sales revenue.
C) The companies have the same relationship between net income and net sales revenue.
D) It is impossible to determine which company has the better relationship between net income and net sales revenue using the information presented.
- Which company has the better relationship between net income and net sales revenue?
A) Johnston Company has the better relationship between net income and net sales revenue.
B) Haley Company has the better relationship net income and net sales revenue.
C) The companies have the same relationship between net income and net sales revenue.
D) It is impossible to determine which company has the better relationship between net income and net sales revenue using the information presented.
Question
The following is a summary of information presented on the income statements of Haley Publications and Johnston Publications for December 31, 2007.
-Which company has the best inventory turnover rate?
A) Johnston Company has the best inventory turnover rate.
B) The companies have the same inventory turnover rate.
C) Haley Company has the best inventory turnover rate.
D) It is impossible to determine which company has the best inventory rate with the information presented.
-Which company has the best inventory turnover rate?
A) Johnston Company has the best inventory turnover rate.
B) The companies have the same inventory turnover rate.
C) Haley Company has the best inventory turnover rate.
D) It is impossible to determine which company has the best inventory rate with the information presented.
Question
The following is a summary of information presented on the income statements of Haley Publications and Johnston Publications for December 31, 2007.
- Based on the information presented, what steps should Johnston take to improve its performance to match or exceed Haley's performance?
A) Johnston should reduce its cost of goods sold as a percentage of net sales revenue.
B) Johnston should reduce its income tax expense as a percentage of net sales revenue.
C) Johnston should reduce its selling and general expenses as a percentage of net sales revenue.
D) All of these actions would improve Johnston's performance.
- Based on the information presented, what steps should Johnston take to improve its performance to match or exceed Haley's performance?
A) Johnston should reduce its cost of goods sold as a percentage of net sales revenue.
B) Johnston should reduce its income tax expense as a percentage of net sales revenue.
C) Johnston should reduce its selling and general expenses as a percentage of net sales revenue.
D) All of these actions would improve Johnston's performance.
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Bevington Studio reported the following income statement and balance sheet amounts on December 31, 2007.
Inventory and prepaid expenses account for $20,000 of the 2007 current assets.
Average inventory for 2007 is $15,000.
Average net accounts receivable for 2007 is $30,000.
Average one-day sales are $3,150.
There are 7,000 shares of common stock outstanding.
Total dividends paid during 2007 were $140,000.
The market price per share of common stock is $21.
-
What is the debt ratio for 2007?
A) 0.25
B) 0.71
C) 0.29
D) 0.55
Inventory and prepaid expenses account for $20,000 of the 2007 current assets.Average inventory for 2007 is $15,000.
Average net accounts receivable for 2007 is $30,000.
Average one-day sales are $3,150.
There are 7,000 shares of common stock outstanding.
Total dividends paid during 2007 were $140,000.
The market price per share of common stock is $21.
-
What is the debt ratio for 2007?
A) 0.25
B) 0.71
C) 0.29
D) 0.55
Question
Bevington Studio reported the following income statement and balance sheet amounts on December 31, 2007.
Inventory and prepaid expenses account for $20,000 of the 2007 current assets.
Average inventory for 2007 is $15,000.
Average net accounts receivable for 2007 is $30,000.
Average one-day sales are $3,150.
There are 7,000 shares of common stock outstanding.
Total dividends paid during 2007 were $140,000.
The market price per share of common stock is $21.
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What is the company's current ratio for 2007?
A) 0.42
B) 2.75
C) 2.40
D) 0.36
Inventory and prepaid expenses account for $20,000 of the 2007 current assets.Average inventory for 2007 is $15,000.
Average net accounts receivable for 2007 is $30,000.
Average one-day sales are $3,150.
There are 7,000 shares of common stock outstanding.
Total dividends paid during 2007 were $140,000.
The market price per share of common stock is $21.
-
What is the company's current ratio for 2007?
A) 0.42
B) 2.75
C) 2.40
D) 0.36
Question
Bevington Studio reported the following income statement and balance sheet amounts on December 31, 2007.
Inventory and prepaid expenses account for $20,000 of the 2007 current assets.
Average inventory for 2007 is $15,000.
Average net accounts receivable for 2007 is $30,000.
Average one-day sales are $3,150.
There are 7,000 shares of common stock outstanding.
Total dividends paid during 2007 were $140,000.
The market price per share of common stock is $21.
-
What is the company's acid-test ratio?
A) 1.60
B) 0.42
C) 2.40
D) 0.63
Inventory and prepaid expenses account for $20,000 of the 2007 current assets.Average inventory for 2007 is $15,000.
Average net accounts receivable for 2007 is $30,000.
Average one-day sales are $3,150.
There are 7,000 shares of common stock outstanding.
Total dividends paid during 2007 were $140,000.
The market price per share of common stock is $21.
-
What is the company's acid-test ratio?
A) 1.60
B) 0.42
C) 2.40
D) 0.63
Question
Bevington Studio reported the following income statement and balance sheet amounts on December 31, 2007.
Inventory and prepaid expenses account for $20,000 of the 2007 current assets.
Average inventory for 2007 is $15,000.
Average net accounts receivable for 2007 is $30,000.
Average one-day sales are $3,150.
There are 7,000 shares of common stock outstanding.
Total dividends paid during 2007 were $140,000.
The market price per share of common stock is $21.
-
What is the company's inventory turnover?
A) 21.33 times
B) 31.50 times
C) 16.00 times
D) 42.00 times
Inventory and prepaid expenses account for $20,000 of the 2007 current assets.Average inventory for 2007 is $15,000.
Average net accounts receivable for 2007 is $30,000.
Average one-day sales are $3,150.
There are 7,000 shares of common stock outstanding.
Total dividends paid during 2007 were $140,000.
The market price per share of common stock is $21.
-
What is the company's inventory turnover?
A) 21.33 times
B) 31.50 times
C) 16.00 times
D) 42.00 times
Question
Bevington Studio reported the following income statement and balance sheet amounts on December 31, 2007.
Inventory and prepaid expenses account for $20,000 of the 2007 current assets.
Average inventory for 2007 is $15,000.
Average net accounts receivable for 2007 is $30,000.
Average one-day sales are $3,150.
There are 7,000 shares of common stock outstanding.
Total dividends paid during 2007 were $140,000.
The market price per share of common stock is $21.
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What is the company's accounts receivable turnover?
A) 31.67 times
B) 200.00 times
C) 47.50 times
D) 301.59 times
Inventory and prepaid expenses account for $20,000 of the 2007 current assets.Average inventory for 2007 is $15,000.
Average net accounts receivable for 2007 is $30,000.
Average one-day sales are $3,150.
There are 7,000 shares of common stock outstanding.
Total dividends paid during 2007 were $140,000.
The market price per share of common stock is $21.
-
What is the company's accounts receivable turnover?
A) 31.67 times
B) 200.00 times
C) 47.50 times
D) 301.59 times
Question
Bevington Studio reported the following income statement and balance sheet amounts on December 31, 2007.
Inventory and prepaid expenses account for $20,000 of the 2007 current assets.
Average inventory for 2007 is $15,000.
Average net accounts receivable for 2007 is $30,000.
Average one-day sales are $3,150.
There are 7,000 shares of common stock outstanding.
Total dividends paid during 2007 were $140,000.
The market price per share of common stock is $21.
-
What is the company's days' sale in receivables?
A) 4.67 days
B) 301.59 days
C) 9.52 days
D) 19.05 days
Inventory and prepaid expenses account for $20,000 of the 2007 current assets.Average inventory for 2007 is $15,000.
Average net accounts receivable for 2007 is $30,000.
Average one-day sales are $3,150.
There are 7,000 shares of common stock outstanding.
Total dividends paid during 2007 were $140,000.
The market price per share of common stock is $21.
-
What is the company's days' sale in receivables?
A) 4.67 days
B) 301.59 days
C) 9.52 days
D) 19.05 days
Question
Bevington Studio reported the following income statement and balance sheet amounts on December 31, 2007.
Inventory and prepaid expenses account for $20,000 of the 2007 current assets.
Average inventory for 2007 is $15,000.
Average net accounts receivable for 2007 is $30,000.
Average one-day sales are $3,150.
There are 7,000 shares of common stock outstanding.
Total dividends paid during 2007 were $140,000.
The market price per share of common stock is $21.
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What is the company's times-interest-earned ratio?
A) 4.5 times
B) 31.5 times
C) 47.5 times
D) 16.0 times
Inventory and prepaid expenses account for $20,000 of the 2007 current assets.Average inventory for 2007 is $15,000.
Average net accounts receivable for 2007 is $30,000.
Average one-day sales are $3,150.
There are 7,000 shares of common stock outstanding.
Total dividends paid during 2007 were $140,000.
The market price per share of common stock is $21.
-
What is the company's times-interest-earned ratio?
A) 4.5 times
B) 31.5 times
C) 47.5 times
D) 16.0 times
Question
Bevington Studio reported the following income statement and balance sheet amounts on December 31, 2007.
Inventory and prepaid expenses account for $20,000 of the 2007 current assets.
Average inventory for 2007 is $15,000.
Average net accounts receivable for 2007 is $30,000.
Average one-day sales are $3,150.
There are 7,000 shares of common stock outstanding.
Total dividends paid during 2007 were $140,000.
The market price per share of common stock is $21.
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What is the company's rate of return on net sales?
A) 0.074
B) 0.111
C) 0.219
D) 0.063
Inventory and prepaid expenses account for $20,000 of the 2007 current assets.Average inventory for 2007 is $15,000.
Average net accounts receivable for 2007 is $30,000.
Average one-day sales are $3,150.
There are 7,000 shares of common stock outstanding.
Total dividends paid during 2007 were $140,000.
The market price per share of common stock is $21.
-
What is the company's rate of return on net sales?
A) 0.074
B) 0.111
C) 0.219
D) 0.063
Question
Bevington Studio reported the following income statement and balance sheet amounts on December 31, 2007.
Inventory and prepaid expenses account for $20,000 of the 2007 current assets.
Average inventory for 2007 is $15,000.
Average net accounts receivable for 2007 is $30,000.
Average one-day sales are $3,150.
There are 7,000 shares of common stock outstanding.
Total dividends paid during 2007 were $140,000.
The market price per share of common stock is $21.
-
What is the company's rate of return on total assets?
A) 0.133
B) 0.137
C) 0.176
D) 0.171
Inventory and prepaid expenses account for $20,000 of the 2007 current assets.Average inventory for 2007 is $15,000.
Average net accounts receivable for 2007 is $30,000.
Average one-day sales are $3,150.
There are 7,000 shares of common stock outstanding.
Total dividends paid during 2007 were $140,000.
The market price per share of common stock is $21.
-
What is the company's rate of return on total assets?
A) 0.133
B) 0.137
C) 0.176
D) 0.171
Question
Bevington Studio reported the following income statement and balance sheet amounts on December 31, 2007.
Inventory and prepaid expenses account for $20,000 of the 2007 current assets.
Average inventory for 2007 is $15,000.
Average net accounts receivable for 2007 is $30,000.
Average one-day sales are $3,150.
There are 7,000 shares of common stock outstanding.
Total dividends paid during 2007 were $140,000.
The market price per share of common stock is $21.
-
What is the company's rate of return on common stockholders' equity?
A) .133
B) .269
C) .209
D) .171
Inventory and prepaid expenses account for $20,000 of the 2007 current assets.Average inventory for 2007 is $15,000.
Average net accounts receivable for 2007 is $30,000.
Average one-day sales are $3,150.
There are 7,000 shares of common stock outstanding.
Total dividends paid during 2007 were $140,000.
The market price per share of common stock is $21.
-
What is the company's rate of return on common stockholders' equity?
A) .133
B) .269
C) .209
D) .171
Question
Bevington Studio reported the following income statement and balance sheet amounts on December 31, 2007.
Inventory and prepaid expenses account for $20,000 of the 2007 current assets.
Average inventory for 2007 is $15,000.
Average net accounts receivable for 2007 is $30,000.
Average one-day sales are $3,150.
There are 7,000 shares of common stock outstanding.
Total dividends paid during 2007 were $140,000.
The market price per share of common stock is $21.
-
What is the company's earnings per share?
A) $42.86
B) $10.00
C) $45.71
D) $12.88
Inventory and prepaid expenses account for $20,000 of the 2007 current assets.Average inventory for 2007 is $15,000.
Average net accounts receivable for 2007 is $30,000.
Average one-day sales are $3,150.
There are 7,000 shares of common stock outstanding.
Total dividends paid during 2007 were $140,000.
The market price per share of common stock is $21.
-
What is the company's earnings per share?
A) $42.86
B) $10.00
C) $45.71
D) $12.88
Question
Bevington Studio reported the following income statement and balance sheet amounts on December 31, 2007.
Inventory and prepaid expenses account for $20,000 of the 2007 current assets.
Average inventory for 2007 is $15,000.
Average net accounts receivable for 2007 is $30,000.
Average one-day sales are $3,150.
There are 7,000 shares of common stock outstanding.
Total dividends paid during 2007 were $140,000.
The market price per share of common stock is $21.
-
What is the company's price/earnings ratio?
A) 1.63
B) 0.46
C) 2.10
D) 0.49
Inventory and prepaid expenses account for $20,000 of the 2007 current assets.Average inventory for 2007 is $15,000.
Average net accounts receivable for 2007 is $30,000.
Average one-day sales are $3,150.
There are 7,000 shares of common stock outstanding.
Total dividends paid during 2007 were $140,000.
The market price per share of common stock is $21.
-
What is the company's price/earnings ratio?
A) 1.63
B) 0.46
C) 2.10
D) 0.49
Question
Bevington Studio reported the following income statement and balance sheet amounts on December 31, 2007.
Inventory and prepaid expenses account for $20,000 of the 2007 current assets.
Average inventory for 2007 is $15,000.
Average net accounts receivable for 2007 is $30,000.
Average one-day sales are $3,150.
There are 7,000 shares of common stock outstanding.
Total dividends paid during 2007 were $140,000.
The market price per share of common stock is $21.
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What is the company's dividend yield?
A) 0.95
B) $20.00
C) 1.05
D) $ 2.00
Inventory and prepaid expenses account for $20,000 of the 2007 current assets.Average inventory for 2007 is $15,000.
Average net accounts receivable for 2007 is $30,000.
Average one-day sales are $3,150.
There are 7,000 shares of common stock outstanding.
Total dividends paid during 2007 were $140,000.
The market price per share of common stock is $21.
-
What is the company's dividend yield?
A) 0.95
B) $20.00
C) 1.05
D) $ 2.00
Question
Bevington Studio reported the following income statement and balance sheet amounts on December 31, 2007.
Inventory and prepaid expenses account for $20,000 of the 2007 current assets.
Average inventory for 2007 is $15,000.
Average net accounts receivable for 2007 is $30,000.
Average one-day sales are $3,150.
There are 7,000 shares of common stock outstanding.
Total dividends paid during 2007 were $140,000.
The market price per share of common stock is $21.
-
What is the company's book value per share of common stock on December 31, 2007?
A) $75.00
B) $15.00
C) $56.43
D) $10.00
Inventory and prepaid expenses account for $20,000 of the 2007 current assets.Average inventory for 2007 is $15,000.
Average net accounts receivable for 2007 is $30,000.
Average one-day sales are $3,150.
There are 7,000 shares of common stock outstanding.
Total dividends paid during 2007 were $140,000.
The market price per share of common stock is $21.
-
What is the company's book value per share of common stock on December 31, 2007?
A) $75.00
B) $15.00
C) $56.43
D) $10.00
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Deck 14: Financial Statement Analysis
1
Which of the following types of analysis includes trend percentage analysis?
A) Vertical analysis
B) Profitability analysis
C) Horizontal analysis
D) Capital analysis
A) Vertical analysis
B) Profitability analysis
C) Horizontal analysis
D) Capital analysis
Horizontal analysis
2
Which of the following types of analysis would include the comparison of 2008 operating expenses with 2007 operating expenses?
A) Horizontal analysis
B) Vertical analysis
C) Profitability analysis
D) Capital analysis
A) Horizontal analysis
B) Vertical analysis
C) Profitability analysis
D) Capital analysis
Horizontal analysis
3
A company reported the following amounts of net income:
- Which of the following is the percentage change in net income from 2007 to 2008?
A) 2.00%
B) 10.00%
C) 8.33%
D) 7.69%
- Which of the following is the percentage change in net income from 2007 to 2008?
A) 2.00%
B) 10.00%
C) 8.33%
D) 7.69%
8.33%
4
A company reported the following amounts of net income:
- Which of the following is the percentage change in net income from 2006 to 2007?
A) 33.33%
B) 8.33%
C) 10.00%
D) 30.00%
- Which of the following is the percentage change in net income from 2006 to 2007?
A) 33.33%
B) 8.33%
C) 10.00%
D) 30.00%
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5
The following is a summary of information presented on the financial statements of The Cake Company on December 31, 2007.
-What would horizontal analysis report with respect to net income before income tax expense and net income?
A) Horizontal analysis would report both net income before income tax expense and net income as 45.45% of net sales revenue.
B) Horizontal analysis would report a $25,000 increase in both net income before income tax expense and net income.
C) Horizontal analysis would report a 45.45% increase in both net income before income tax expense and net income.
D) None of the above is correct.
-What would horizontal analysis report with respect to net income before income tax expense and net income?
A) Horizontal analysis would report both net income before income tax expense and net income as 45.45% of net sales revenue.
B) Horizontal analysis would report a $25,000 increase in both net income before income tax expense and net income.
C) Horizontal analysis would report a 45.45% increase in both net income before income tax expense and net income.
D) None of the above is correct.
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6
The following is a summary of information presented on the financial statements of The Cake Company on December 31, 2007.
- What would horizontal analysis report with respect to common stock?
A) Horizontal analysis would report stockholders' equity as 25.64% of total capital.
B) Horizontal analysis would report a dividend yield of $8.20.
C) Horizontal analysis would report a rate of return on stockholders' equity of $11.20.
D) Horizontal analysis would report a 25% increase in common stock.
- What would horizontal analysis report with respect to common stock?
A) Horizontal analysis would report stockholders' equity as 25.64% of total capital.
B) Horizontal analysis would report a dividend yield of $8.20.
C) Horizontal analysis would report a rate of return on stockholders' equity of $11.20.
D) Horizontal analysis would report a 25% increase in common stock.
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7
The net income for a company was $630,000 last year and $540,000 this year. The percentage of increase or decrease was from last year to this year is:
A) 14.29%.
B) 16.67%.
C) 7.14%.
D) 8.33%.
A) 14.29%.
B) 16.67%.
C) 7.14%.
D) 8.33%.
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8
Which of the following financial statements is rarely the object of vertical analysis?
A) The income statement is rarely the object of vertical analysis.
B) The statement of cash flows is rarely the object of vertical analysis.
C) The balance sheet is rarely the object of vertical analysis.
D) All of the above statements are commonly the object of vertical analysis.
A) The income statement is rarely the object of vertical analysis.
B) The statement of cash flows is rarely the object of vertical analysis.
C) The balance sheet is rarely the object of vertical analysis.
D) All of the above statements are commonly the object of vertical analysis.
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9
The following is a summary of information presented on the income statement of HR Flowers for December 31, 2007.
- What would vertical analysis report with respect to 2007 net income before income tax and income tax expense?
A) Vertical analysis would report net income before income tax as 17.86% and income tax expense as 4.93% of net sales revenue.
B) Vertical analysis would report a 58.18% increase in both net income before income tax and income tax expense.
C) Vertical analysis would report a $32,000 increase in both net income before income tax and income tax expense.
D) None of the above is correct.
- What would vertical analysis report with respect to 2007 net income before income tax and income tax expense?
A) Vertical analysis would report net income before income tax as 17.86% and income tax expense as 4.93% of net sales revenue.
B) Vertical analysis would report a 58.18% increase in both net income before income tax and income tax expense.
C) Vertical analysis would report a $32,000 increase in both net income before income tax and income tax expense.
D) None of the above is correct.
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10
The following is a summary of information presented on the income statement of HR Flowers for December 31, 2007.
-What would vertical analysis report with respect to 2007 net sales revenue?
A) Vertical analysis would report cost of goods sold as 79.19% of net sales revenue.
B) Vertical analysis would report a dividend yield of $8.20.
C) Vertical analysis would report net sales revenue as the 100% base amount.
D) Vertical analysis would report a 2.60% decrease in net sales revenue.
-What would vertical analysis report with respect to 2007 net sales revenue?
A) Vertical analysis would report cost of goods sold as 79.19% of net sales revenue.
B) Vertical analysis would report a dividend yield of $8.20.
C) Vertical analysis would report net sales revenue as the 100% base amount.
D) Vertical analysis would report a 2.60% decrease in net sales revenue.
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11
The following is a summary of information presented on the income statement of HR Flowers for December 31, 2007.
- What would vertical analysis report with respect to 2007 selling and general expenses?
A) Vertical analysis would report a 40.00% increase in selling and general expenses.
B) Vertical analysis would report a 40.00% decrease in selling and general expenses.
C) Vertical analysis would report selling and general expenses as 14.37% of net sales revenue.
D) Vertical analysis would report selling and general expenses as 10.00% of net sales revenue.
- What would vertical analysis report with respect to 2007 selling and general expenses?
A) Vertical analysis would report a 40.00% increase in selling and general expenses.
B) Vertical analysis would report a 40.00% decrease in selling and general expenses.
C) Vertical analysis would report selling and general expenses as 14.37% of net sales revenue.
D) Vertical analysis would report selling and general expenses as 10.00% of net sales revenue.
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12
The following is a summary of information presented on the income statement of HR Flowers for December 31, 2007.
- What would vertical analysis report with respect to the relationship between 2007 net sales revenue and cost of goods sold?
A) Vertical analysis would report that cost of goods sold was too high as a percentage of net sales revenue.
B) Vertical analysis would report that cost of goods sold was 67.76% of net sales revenue.
C) Vertical analysis would report that cost of goods sold increased more than net sales revenue.
D) Vertical analysis would report that cost of goods sold was too low as a percentage of net sales revenue.
- What would vertical analysis report with respect to the relationship between 2007 net sales revenue and cost of goods sold?
A) Vertical analysis would report that cost of goods sold was too high as a percentage of net sales revenue.
B) Vertical analysis would report that cost of goods sold was 67.76% of net sales revenue.
C) Vertical analysis would report that cost of goods sold increased more than net sales revenue.
D) Vertical analysis would report that cost of goods sold was too low as a percentage of net sales revenue.
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13
The following is a summary of information presented on the income statement of HR Flowers for December 31, 2007.
-What would vertical analysis report with respect to 2007 income tax expense?
A) Vertical analysis would report a $7,500 increase income tax expense.
B) Vertical analysis would report income tax expense as 4.93% of net sales revenue.
C) Vertical analysis would report a 45.45% increase in income tax expense.
D) Vertical analysis would report income tax expense as 27.59% of net income before income tax.
-What would vertical analysis report with respect to 2007 income tax expense?
A) Vertical analysis would report a $7,500 increase income tax expense.
B) Vertical analysis would report income tax expense as 4.93% of net sales revenue.
C) Vertical analysis would report a 45.45% increase in income tax expense.
D) Vertical analysis would report income tax expense as 27.59% of net income before income tax.
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14
What type of analysis is illustrated in the following table?
A) The table illustrates a common-size balance sheet
B) The table illustrates vertical analysis.
C) The table illustrates benchmarking.
D) The table illustrates horizontal analysis.
A) The table illustrates a common-size balance sheet
B) The table illustrates vertical analysis.
C) The table illustrates benchmarking.
D) The table illustrates horizontal analysis.
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15
The following is a summary of information presented on the income statements of Haley Publications and Johnston Publications for December 31, 2007.
- Which company has the better relationship between selling and general expenses and net sales revenue?
A) It is impossible to determine which company has the better relationship between selling and general expenses and net sales revenue using the information presented.
B) The companies have the same relationship between selling and general expenses and net sales revenue.
C) Johnston Company has the better relationship between selling and general expenses and net sales revenue.
D) Haley Company has the better relationship between selling and general expenses and net sales revenue.
- Which company has the better relationship between selling and general expenses and net sales revenue?
A) It is impossible to determine which company has the better relationship between selling and general expenses and net sales revenue using the information presented.
B) The companies have the same relationship between selling and general expenses and net sales revenue.
C) Johnston Company has the better relationship between selling and general expenses and net sales revenue.
D) Haley Company has the better relationship between selling and general expenses and net sales revenue.
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16
The following is a summary of information presented on the income statements of Haley Publications and Johnston Publications for December 31, 2007.
- Which company has the better relationship between gross profit and net sales revenue?
A) The companies have the same relationship between gross profit and net sales revenue.
B) Haley Company has the better relationship between gross profit and net sales revenue.
C) Johnston Company has the better relationship between gross profit and net sales revenue.
D) It is impossible to determine which company has the better relationship between gross profit and net sales revenue using the information presented.
- Which company has the better relationship between gross profit and net sales revenue?
A) The companies have the same relationship between gross profit and net sales revenue.
B) Haley Company has the better relationship between gross profit and net sales revenue.
C) Johnston Company has the better relationship between gross profit and net sales revenue.
D) It is impossible to determine which company has the better relationship between gross profit and net sales revenue using the information presented.
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17
The following is a summary of information presented on the income statements of Haley Publications and Johnston Publications for December 31, 2007.
- Which company has the better relationship between net income and net sales revenue?
A) Johnston Company has the better relationship between net income and net sales revenue.
B) Haley Company has the better relationship net income and net sales revenue.
C) The companies have the same relationship between net income and net sales revenue.
D) It is impossible to determine which company has the better relationship between net income and net sales revenue using the information presented.
- Which company has the better relationship between net income and net sales revenue?
A) Johnston Company has the better relationship between net income and net sales revenue.
B) Haley Company has the better relationship net income and net sales revenue.
C) The companies have the same relationship between net income and net sales revenue.
D) It is impossible to determine which company has the better relationship between net income and net sales revenue using the information presented.
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18
The following is a summary of information presented on the income statements of Haley Publications and Johnston Publications for December 31, 2007.
-Which company has the best inventory turnover rate?
A) Johnston Company has the best inventory turnover rate.
B) The companies have the same inventory turnover rate.
C) Haley Company has the best inventory turnover rate.
D) It is impossible to determine which company has the best inventory rate with the information presented.
-Which company has the best inventory turnover rate?
A) Johnston Company has the best inventory turnover rate.
B) The companies have the same inventory turnover rate.
C) Haley Company has the best inventory turnover rate.
D) It is impossible to determine which company has the best inventory rate with the information presented.
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19
The following is a summary of information presented on the income statements of Haley Publications and Johnston Publications for December 31, 2007.
- Based on the information presented, what steps should Johnston take to improve its performance to match or exceed Haley's performance?
A) Johnston should reduce its cost of goods sold as a percentage of net sales revenue.
B) Johnston should reduce its income tax expense as a percentage of net sales revenue.
C) Johnston should reduce its selling and general expenses as a percentage of net sales revenue.
D) All of these actions would improve Johnston's performance.
- Based on the information presented, what steps should Johnston take to improve its performance to match or exceed Haley's performance?
A) Johnston should reduce its cost of goods sold as a percentage of net sales revenue.
B) Johnston should reduce its income tax expense as a percentage of net sales revenue.
C) Johnston should reduce its selling and general expenses as a percentage of net sales revenue.
D) All of these actions would improve Johnston's performance.
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20
Which of the following types of analysis included common-size financial statements?
A) Common-size financial statements are a type of trend analysis.
B) Common-size financial statements are a type of vertical analysis.
C) Common-size financial statements are a type of ratio analysis.
D) Common-size financial statements are a type of horizontal analysis.
A) Common-size financial statements are a type of trend analysis.
B) Common-size financial statements are a type of vertical analysis.
C) Common-size financial statements are a type of ratio analysis.
D) Common-size financial statements are a type of horizontal analysis.
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21
A company that has $510,000 in average common stockholders' equity, net income of $312,000 and preferred dividends paid of $15,000 has a rate of return on stockholders' equity of 61.2%
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22
Which of the following ratios is used to determine the salability of inventory?
A) Current ratio
B) Inventory turnover
C) Working capital
D) Rate of return on inventory
A) Current ratio
B) Inventory turnover
C) Working capital
D) Rate of return on inventory
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23
Which of the following is the formula to compute day's sales in receivable?
A) The formula is Cost of goods sold/Average inventory.
B) The formula is Net credit sales/Average net accounts receivable.
C) The formula is Net credit sales/Average inventory.
D) The formula is Average net accounts receivable/One day's sales.
A) The formula is Cost of goods sold/Average inventory.
B) The formula is Net credit sales/Average net accounts receivable.
C) The formula is Net credit sales/Average inventory.
D) The formula is Average net accounts receivable/One day's sales.
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24
Which of the following is the formula to compute the debt ratio?
A) The formula is Total assets/Total liabilities.
B) The formula is Income from operations/Interest expense.
C) The formula is Interest expense/Income from operations.
D) The formula is Total liabilities/Total assets.
A) The formula is Total assets/Total liabilities.
B) The formula is Income from operations/Interest expense.
C) The formula is Interest expense/Income from operations.
D) The formula is Total liabilities/Total assets.
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25
Bevington Studio reported the following income statement and balance sheet amounts on December 31, 2007.
Inventory and prepaid expenses account for $20,000 of the 2007 current assets.
Average inventory for 2007 is $15,000.
Average net accounts receivable for 2007 is $30,000.
Average one-day sales are $3,150.
There are 7,000 shares of common stock outstanding.
Total dividends paid during 2007 were $140,000.
The market price per share of common stock is $21.
-
What is the debt ratio for 2007?
A) 0.25
B) 0.71
C) 0.29
D) 0.55
Inventory and prepaid expenses account for $20,000 of the 2007 current assets.Average inventory for 2007 is $15,000.
Average net accounts receivable for 2007 is $30,000.
Average one-day sales are $3,150.
There are 7,000 shares of common stock outstanding.
Total dividends paid during 2007 were $140,000.
The market price per share of common stock is $21.
-
What is the debt ratio for 2007?
A) 0.25
B) 0.71
C) 0.29
D) 0.55
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26
Bevington Studio reported the following income statement and balance sheet amounts on December 31, 2007.
Inventory and prepaid expenses account for $20,000 of the 2007 current assets.
Average inventory for 2007 is $15,000.
Average net accounts receivable for 2007 is $30,000.
Average one-day sales are $3,150.
There are 7,000 shares of common stock outstanding.
Total dividends paid during 2007 were $140,000.
The market price per share of common stock is $21.
-
What is the company's current ratio for 2007?
A) 0.42
B) 2.75
C) 2.40
D) 0.36
Inventory and prepaid expenses account for $20,000 of the 2007 current assets.Average inventory for 2007 is $15,000.
Average net accounts receivable for 2007 is $30,000.
Average one-day sales are $3,150.
There are 7,000 shares of common stock outstanding.
Total dividends paid during 2007 were $140,000.
The market price per share of common stock is $21.
-
What is the company's current ratio for 2007?
A) 0.42
B) 2.75
C) 2.40
D) 0.36
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27
Bevington Studio reported the following income statement and balance sheet amounts on December 31, 2007.
Inventory and prepaid expenses account for $20,000 of the 2007 current assets.
Average inventory for 2007 is $15,000.
Average net accounts receivable for 2007 is $30,000.
Average one-day sales are $3,150.
There are 7,000 shares of common stock outstanding.
Total dividends paid during 2007 were $140,000.
The market price per share of common stock is $21.
-
What is the company's acid-test ratio?
A) 1.60
B) 0.42
C) 2.40
D) 0.63
Inventory and prepaid expenses account for $20,000 of the 2007 current assets.Average inventory for 2007 is $15,000.
Average net accounts receivable for 2007 is $30,000.
Average one-day sales are $3,150.
There are 7,000 shares of common stock outstanding.
Total dividends paid during 2007 were $140,000.
The market price per share of common stock is $21.
-
What is the company's acid-test ratio?
A) 1.60
B) 0.42
C) 2.40
D) 0.63
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28
Bevington Studio reported the following income statement and balance sheet amounts on December 31, 2007.
Inventory and prepaid expenses account for $20,000 of the 2007 current assets.
Average inventory for 2007 is $15,000.
Average net accounts receivable for 2007 is $30,000.
Average one-day sales are $3,150.
There are 7,000 shares of common stock outstanding.
Total dividends paid during 2007 were $140,000.
The market price per share of common stock is $21.
-
What is the company's inventory turnover?
A) 21.33 times
B) 31.50 times
C) 16.00 times
D) 42.00 times
Inventory and prepaid expenses account for $20,000 of the 2007 current assets.Average inventory for 2007 is $15,000.
Average net accounts receivable for 2007 is $30,000.
Average one-day sales are $3,150.
There are 7,000 shares of common stock outstanding.
Total dividends paid during 2007 were $140,000.
The market price per share of common stock is $21.
-
What is the company's inventory turnover?
A) 21.33 times
B) 31.50 times
C) 16.00 times
D) 42.00 times
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29
Bevington Studio reported the following income statement and balance sheet amounts on December 31, 2007.
Inventory and prepaid expenses account for $20,000 of the 2007 current assets.
Average inventory for 2007 is $15,000.
Average net accounts receivable for 2007 is $30,000.
Average one-day sales are $3,150.
There are 7,000 shares of common stock outstanding.
Total dividends paid during 2007 were $140,000.
The market price per share of common stock is $21.
-
What is the company's accounts receivable turnover?
A) 31.67 times
B) 200.00 times
C) 47.50 times
D) 301.59 times
Inventory and prepaid expenses account for $20,000 of the 2007 current assets.Average inventory for 2007 is $15,000.
Average net accounts receivable for 2007 is $30,000.
Average one-day sales are $3,150.
There are 7,000 shares of common stock outstanding.
Total dividends paid during 2007 were $140,000.
The market price per share of common stock is $21.
-
What is the company's accounts receivable turnover?
A) 31.67 times
B) 200.00 times
C) 47.50 times
D) 301.59 times
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30
Bevington Studio reported the following income statement and balance sheet amounts on December 31, 2007.
Inventory and prepaid expenses account for $20,000 of the 2007 current assets.
Average inventory for 2007 is $15,000.
Average net accounts receivable for 2007 is $30,000.
Average one-day sales are $3,150.
There are 7,000 shares of common stock outstanding.
Total dividends paid during 2007 were $140,000.
The market price per share of common stock is $21.
-
What is the company's days' sale in receivables?
A) 4.67 days
B) 301.59 days
C) 9.52 days
D) 19.05 days
Inventory and prepaid expenses account for $20,000 of the 2007 current assets.Average inventory for 2007 is $15,000.
Average net accounts receivable for 2007 is $30,000.
Average one-day sales are $3,150.
There are 7,000 shares of common stock outstanding.
Total dividends paid during 2007 were $140,000.
The market price per share of common stock is $21.
-
What is the company's days' sale in receivables?
A) 4.67 days
B) 301.59 days
C) 9.52 days
D) 19.05 days
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31
Bevington Studio reported the following income statement and balance sheet amounts on December 31, 2007.
Inventory and prepaid expenses account for $20,000 of the 2007 current assets.
Average inventory for 2007 is $15,000.
Average net accounts receivable for 2007 is $30,000.
Average one-day sales are $3,150.
There are 7,000 shares of common stock outstanding.
Total dividends paid during 2007 were $140,000.
The market price per share of common stock is $21.
-
What is the company's times-interest-earned ratio?
A) 4.5 times
B) 31.5 times
C) 47.5 times
D) 16.0 times
Inventory and prepaid expenses account for $20,000 of the 2007 current assets.Average inventory for 2007 is $15,000.
Average net accounts receivable for 2007 is $30,000.
Average one-day sales are $3,150.
There are 7,000 shares of common stock outstanding.
Total dividends paid during 2007 were $140,000.
The market price per share of common stock is $21.
-
What is the company's times-interest-earned ratio?
A) 4.5 times
B) 31.5 times
C) 47.5 times
D) 16.0 times
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32
Bevington Studio reported the following income statement and balance sheet amounts on December 31, 2007.
Inventory and prepaid expenses account for $20,000 of the 2007 current assets.
Average inventory for 2007 is $15,000.
Average net accounts receivable for 2007 is $30,000.
Average one-day sales are $3,150.
There are 7,000 shares of common stock outstanding.
Total dividends paid during 2007 were $140,000.
The market price per share of common stock is $21.
-
What is the company's rate of return on net sales?
A) 0.074
B) 0.111
C) 0.219
D) 0.063
Inventory and prepaid expenses account for $20,000 of the 2007 current assets.Average inventory for 2007 is $15,000.
Average net accounts receivable for 2007 is $30,000.
Average one-day sales are $3,150.
There are 7,000 shares of common stock outstanding.
Total dividends paid during 2007 were $140,000.
The market price per share of common stock is $21.
-
What is the company's rate of return on net sales?
A) 0.074
B) 0.111
C) 0.219
D) 0.063
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33
Bevington Studio reported the following income statement and balance sheet amounts on December 31, 2007.
Inventory and prepaid expenses account for $20,000 of the 2007 current assets.
Average inventory for 2007 is $15,000.
Average net accounts receivable for 2007 is $30,000.
Average one-day sales are $3,150.
There are 7,000 shares of common stock outstanding.
Total dividends paid during 2007 were $140,000.
The market price per share of common stock is $21.
-
What is the company's rate of return on total assets?
A) 0.133
B) 0.137
C) 0.176
D) 0.171
Inventory and prepaid expenses account for $20,000 of the 2007 current assets.Average inventory for 2007 is $15,000.
Average net accounts receivable for 2007 is $30,000.
Average one-day sales are $3,150.
There are 7,000 shares of common stock outstanding.
Total dividends paid during 2007 were $140,000.
The market price per share of common stock is $21.
-
What is the company's rate of return on total assets?
A) 0.133
B) 0.137
C) 0.176
D) 0.171
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34
Bevington Studio reported the following income statement and balance sheet amounts on December 31, 2007.
Inventory and prepaid expenses account for $20,000 of the 2007 current assets.
Average inventory for 2007 is $15,000.
Average net accounts receivable for 2007 is $30,000.
Average one-day sales are $3,150.
There are 7,000 shares of common stock outstanding.
Total dividends paid during 2007 were $140,000.
The market price per share of common stock is $21.
-
What is the company's rate of return on common stockholders' equity?
A) .133
B) .269
C) .209
D) .171
Inventory and prepaid expenses account for $20,000 of the 2007 current assets.Average inventory for 2007 is $15,000.
Average net accounts receivable for 2007 is $30,000.
Average one-day sales are $3,150.
There are 7,000 shares of common stock outstanding.
Total dividends paid during 2007 were $140,000.
The market price per share of common stock is $21.
-
What is the company's rate of return on common stockholders' equity?
A) .133
B) .269
C) .209
D) .171
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35
Bevington Studio reported the following income statement and balance sheet amounts on December 31, 2007.
Inventory and prepaid expenses account for $20,000 of the 2007 current assets.
Average inventory for 2007 is $15,000.
Average net accounts receivable for 2007 is $30,000.
Average one-day sales are $3,150.
There are 7,000 shares of common stock outstanding.
Total dividends paid during 2007 were $140,000.
The market price per share of common stock is $21.
-
What is the company's earnings per share?
A) $42.86
B) $10.00
C) $45.71
D) $12.88
Inventory and prepaid expenses account for $20,000 of the 2007 current assets.Average inventory for 2007 is $15,000.
Average net accounts receivable for 2007 is $30,000.
Average one-day sales are $3,150.
There are 7,000 shares of common stock outstanding.
Total dividends paid during 2007 were $140,000.
The market price per share of common stock is $21.
-
What is the company's earnings per share?
A) $42.86
B) $10.00
C) $45.71
D) $12.88
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36
Bevington Studio reported the following income statement and balance sheet amounts on December 31, 2007.
Inventory and prepaid expenses account for $20,000 of the 2007 current assets.
Average inventory for 2007 is $15,000.
Average net accounts receivable for 2007 is $30,000.
Average one-day sales are $3,150.
There are 7,000 shares of common stock outstanding.
Total dividends paid during 2007 were $140,000.
The market price per share of common stock is $21.
-
What is the company's price/earnings ratio?
A) 1.63
B) 0.46
C) 2.10
D) 0.49
Inventory and prepaid expenses account for $20,000 of the 2007 current assets.Average inventory for 2007 is $15,000.
Average net accounts receivable for 2007 is $30,000.
Average one-day sales are $3,150.
There are 7,000 shares of common stock outstanding.
Total dividends paid during 2007 were $140,000.
The market price per share of common stock is $21.
-
What is the company's price/earnings ratio?
A) 1.63
B) 0.46
C) 2.10
D) 0.49
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37
Bevington Studio reported the following income statement and balance sheet amounts on December 31, 2007.
Inventory and prepaid expenses account for $20,000 of the 2007 current assets.
Average inventory for 2007 is $15,000.
Average net accounts receivable for 2007 is $30,000.
Average one-day sales are $3,150.
There are 7,000 shares of common stock outstanding.
Total dividends paid during 2007 were $140,000.
The market price per share of common stock is $21.
-
What is the company's dividend yield?
A) 0.95
B) $20.00
C) 1.05
D) $ 2.00
Inventory and prepaid expenses account for $20,000 of the 2007 current assets.Average inventory for 2007 is $15,000.
Average net accounts receivable for 2007 is $30,000.
Average one-day sales are $3,150.
There are 7,000 shares of common stock outstanding.
Total dividends paid during 2007 were $140,000.
The market price per share of common stock is $21.
-
What is the company's dividend yield?
A) 0.95
B) $20.00
C) 1.05
D) $ 2.00
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38
Bevington Studio reported the following income statement and balance sheet amounts on December 31, 2007.
Inventory and prepaid expenses account for $20,000 of the 2007 current assets.
Average inventory for 2007 is $15,000.
Average net accounts receivable for 2007 is $30,000.
Average one-day sales are $3,150.
There are 7,000 shares of common stock outstanding.
Total dividends paid during 2007 were $140,000.
The market price per share of common stock is $21.
-
What is the company's book value per share of common stock on December 31, 2007?
A) $75.00
B) $15.00
C) $56.43
D) $10.00
Inventory and prepaid expenses account for $20,000 of the 2007 current assets.Average inventory for 2007 is $15,000.
Average net accounts receivable for 2007 is $30,000.
Average one-day sales are $3,150.
There are 7,000 shares of common stock outstanding.
Total dividends paid during 2007 were $140,000.
The market price per share of common stock is $21.
-
What is the company's book value per share of common stock on December 31, 2007?
A) $75.00
B) $15.00
C) $56.43
D) $10.00
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39
The net sales for a company were $3,600,000; gross profit was $600,000; and net income was $260,000. The rate of return on net sales would be:
A) 0.0722.
B) 0.1667.
C) 0.2389.
D) 0.4333.
A) 0.0722.
B) 0.1667.
C) 0.2389.
D) 0.4333.
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40
A company has cash, $85,000; temporary investments, $30,000; net receivables, $60,000; and inventory, $350,000. Current liabilities are $300,000. The current ratio is:
A) 0.58.
B) 0.74.
C) 1.75.
D) 1.86.
A) 0.58.
B) 0.74.
C) 1.75.
D) 1.86.
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41
A company has cash, $85,000; temporary investments, $30,000; net receivables, $60,000; and inventory, $350,000. Current liabilities are $300,000. The acid-test ratio is:
A) 0.58.
B) 0.74.
C) 1.75.
D) 1.86.
A) 0.58.
B) 0.74.
C) 1.75.
D) 1.86.
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42
A company has net sales on account of $1,750,000. Net accounts receivable at the beginning of the year are $147,000 and at the end of the year are $153,000. The accounts receivable turnover is:
A) 11.9.
B) 11.7.
C) 11.4.
D) 1.0.
A) 11.9.
B) 11.7.
C) 11.4.
D) 1.0.
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43
A company has net sales on account of $1,750,000. Net accounts receivable at the beginning of the year are $147,000 and at the end of the year are $153,000. The days' sales in average receivables is:
A) 30.67.
B) 31.28.
C) 32.02.
D) 365.0.
A) 30.67.
B) 31.28.
C) 32.02.
D) 365.0.
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44
A company has cash $80,000; temporary investments, $20,000; net receivables, $60,000; and inventory of $450,000. Current liabilities are $200,000. The quick or acid-test ratio is:
A) 0.54.
B) 0.80.
C) 2.25.
D) 3.05.
A) 0.54.
B) 0.80.
C) 2.25.
D) 3.05.
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45
A company has cash $80,000; temporary investments, $20,000; net receivables, $60,000; and inventory of $450,000. Current liabilities are $200,000. The current ratio is:
A) 0.54.
B) 0.80.
C) 2.25.
D) 3.05.
A) 0.54.
B) 0.80.
C) 2.25.
D) 3.05.
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46
The net income for the year was $720,000; total assets at the beginning of the year was $2,100,000; and total year-end assets were $2,300,000. The return on assets would be:
A) 0.011.
B) 0.031.
C) 0.112.
D) 0.327.
A) 0.011.
B) 0.031.
C) 0.112.
D) 0.327.
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47
The net income of a company is $175,000. The average book value of the company's assets is $1,300,000. The return on total assets would be:
A) 0.2000.
B) 0.0743.
C) 6.0000.
D) 0.1346.
A) 0.2000.
B) 0.0743.
C) 6.0000.
D) 0.1346.
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48
The net income of a company for the year just ended in $230,000. Income tax is $80,500 and interest expense if $20,000. The number of times interest was earned would be:
A) 0.05.
B) 10.5.
C) 11.5.
D) 16.53.
A) 0.05.
B) 10.5.
C) 11.5.
D) 16.53.
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49
The net income for the year ended was $300,000. Common stockholders' equity at the beginning of the year was $1,400,000 and $1,600,000 at the end of the year. The return on common stockholders' equity would be:
A) 18.75%.
B) 20.00%.
C) 21.43%.
D 87.50%.
A) 18.75%.
B) 20.00%.
C) 21.43%.
D 87.50%.
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50
A company reports net income of $70,000 and net sales of $950,000. Which of the following is the rate of return on net sales?
A) 0.05
B) 0.20
C) 0.07
D) 0.66
A) 0.05
B) 0.20
C) 0.07
D) 0.66
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51
A company reports total assets of $525,000 and stockholders' equity of $395,000. Which of the following is the debt ratio?
A) 0.29
B) 0.71
C) 0.55
D) 0.25
A) 0.29
B) 0.71
C) 0.55
D) 0.25
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52
Zebra Inc. has cost of goods sold for the year of $1,900,000. The average inventory for the year is $129,000. The inventory turnover for the year is:
A) 0.1.
B) 14.7.
C) 33.8.
D) 65.5.
A) 0.1.
B) 14.7.
C) 33.8.
D) 65.5.
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Unlock Deck
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