Question 1

External users of financial information:

Accepted Answer

A)  Are those individuals involved in managing and operating the company.
B)  Include internal auditors and consultants.
C)  Are not directly involved in operating the company.
D)  Make strategic decisions for a company.
E)  Make operating decisions for a company.F) B) and D)
G) B) and C)

Question 2

Selected current year company information follows:  The total asset turnover is:

Accepted Answer

A)  2.24 times
B)  2.81 times
C)  3.64 times
D)  4.67 times
E)  6.28 timesF) A) and E)
G) B) and C)

Question 3

The comparative income statements for Silverlight Company are shown below.Calculate the following ratios for 2016:
(a)profit margin
(b)gross margin
(c)times interest earned.

Accepted Answer

The answer of The comparative income statements for Silverlight Company...

Question 4

Current assets minus current liabilities is:

Accepted Answer

A)  Profit margin.
B)  Financial leverage.
C)  Current ratio.
D)  Working capital.
E)  Quick assets.F) D) and E)
G) A) and B)

Question 5

Carducci Corporation reported Net sales of $3.6 million and beginning Total assets of $0.9 million and ending Total assets of 1.3 million.The average Total asset amount is:

Accepted Answer

A)  $2.3 million.
B)  $2.7 million.
C)  $0.25 million.
D)  $0.36 million.
E)  $1.1 million.F) B) and E)
G) A) and D)

Question 6

The gross margin ratio,return on total assets,and basic earnings per share are all _____________ ratios.

Accepted Answer

The answer of The gross margin ratio,return on total assets,and...

Question 7

The ability to provide financial rewards sufficient to attract and retain financing is called:

Accepted Answer

A)  Liquidity and efficiency.
B)  Solvency.
C)  Profitability.
D)  Market prospects.
E)  Creditworthiness.F) A) and E)
G) A) and D)

Question 8

Evaluation of company performance can include comparison and/or assessment of all but which of the following?

Accepted Answer

A)  Past performance.
B)  Current performance.
C)  Current financial position.
D)  Future performance and risk.
E)  External user needs and demands.F) A) and B)
G) None of the above

Question 9

Efficiency refers to how productive a company is in using its assets,and is usually measured relative to how much revenue is generated from a certain level of assets.

Accepted Answer

A) True 
 B)False

Question 10

General-purpose financial statements include the (1)______________, (2)_____________, (3)_______________, (4)______________,and (5)________________.

Accepted Answer

income statement ;balance shee...

Question 11

Refer to the following selected financial information from McCormik,LLC.Compute the company's inventory turnover for Year 2.

Accepted Answer

A)  4.72.
B)  4.33.
C)  3.28.
D)  5.78.
E)  3.86.F) A) and C)
G) C) and D)

Question 12

The current year-end balance sheet data for a company are shown below.Calculate the company's:
(a)working capital
(b)current ratio
(c)acid-test ratio.

Accepted Answer

The answer of The current year-end balance sheet data for...

Question 13

The measurement of key relations among financial statement items is known as:

Accepted Answer

A)  Financial reporting.
B)  Horizontal analysis.
C)  Investment analysis.
D)  Ratio analysis.
E)  Risk analysis.F) A) and B)
G) A) and C)

Question 14

The ability to meet short-term obligations and to efficiently generate revenues is called:

Accepted Answer

A)  Liquidity and efficiency.
B)  Solvency.
C)  Profitability.
D)  Market prospects.
E)  Creditworthiness.F) A) and E)
G) A) and C)

Question 15

Use the following selected information from Wheeler,LLC to determine the 2015 and 2014 trend percentages for net sales using 2014 as the base.

Accepted Answer

A)  36.4% for 2015 and 41.1% for 2014.
B)  55.0% for 2015 and 56.0% for 2014.
C)  119.4% for 2015 and 100.0% for 2014.
D)  117.2% for 2015 and 100.0% for 2014.
E)  65.1% for 2015 and 64.6% for 2014.F) B) and C)
G) A) and B)

Question 16

Intra-company analysis is based on comparisons with competitors.

Accepted Answer

A) True 
 B)False

Question 17

Three of the most common tools of financial analysis include horizontal analysis,vertical analysis,and ratio analysis.

Accepted Answer

A) True 
 B)False

Question 18

The current ratio and acid-test ratio are used to reflect the ____________ of a business.

Accepted Answer

The answer of The current ratio and acid-test ratio are...

Question 19

Horizontal analysis is used to reveal changes in the relative importance of each financial statement item.

Accepted Answer

A) True 
 B)False

Question 20

The ability to generate positive market expectations is called:

Accepted Answer

A)  Liquidity and efficiency.
B)  Liquidity and solvency.
C)  Profitability.
D)  Market prospects.
E)  Creditworthiness.F) A) and B)
G) C) and D)

Exam 17: Analysis of Financial Statements

The current year-end balance sheet data for a company are shown below.Calculate the company's: (a)working capital (b)current ratio (c)acid-test ratio.

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The gross margin ratio,return on total assets,and basic earnings per share are all _____________ ratios.

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Current assets minus current liabilities is:

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General-purpose financial statements include the (1)______________, (2)_____________, (3)_______________, (4)______________,and (5)________________.

Correct Answerverifiedincome statement ;balance shee...View AnswerShow Answer

Carducci Corporation reported Net sales of $3.6 million and beginning Total assets of $0.9 million and ending Total assets of 1.3 million.The average Total asset amount is:

Correct AnswerverifiedShow Answer

The ability to provide financial rewards sufficient to attract and retain financing is called:

Correct AnswerverifiedShow Answer

Horizontal analysis is used to reveal changes in the relative importance of each financial statement item.

Correct AnswerverifiedShow Answer

Three of the most common tools of financial analysis include horizontal analysis,vertical analysis,and ratio analysis.

Correct AnswerverifiedShow Answer

Evaluation of company performance can include comparison and/or assessment of all but which of the following?

Correct AnswerverifiedShow Answer

Use the following selected information from Wheeler,LLC to determine the 2015 and 2014 trend percentages for net sales using 2014 as the base.

Correct AnswerverifiedShow Answer

The ability to meet short-term obligations and to efficiently generate revenues is called:

Correct AnswerverifiedShow Answer

The current ratio and acid-test ratio are used to reflect the ____________ of a business.

Correct AnswerverifiedShow Answer

The measurement of key relations among financial statement items is known as:

Correct AnswerverifiedShow Answer

Efficiency refers to how productive a company is in using its assets,and is usually measured relative to how much revenue is generated from a certain level of assets.

Correct AnswerverifiedShow Answer

The ability to generate positive market expectations is called:

Correct AnswerverifiedShow Answer

Intra-company analysis is based on comparisons with competitors.

Correct AnswerverifiedShow Answer

Selected current year company information follows: The total asset turnover is:

Correct AnswerverifiedShow Answer

Refer to the following selected financial information from McCormik,LLC.Compute the company's inventory turnover for Year 2.

Correct AnswerverifiedShow Answer

The comparative income statements for Silverlight Company are shown below.Calculate the following ratios for 2016: (a)profit margin (b)gross margin (c)times interest earned.

Correct AnswerverifiedShow Answer

External users of financial information:

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General-purpose financial statements include the (1)________, (2)_, (3)_, (4),and (5)__________.

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income statement ;balance shee...
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