FiltersDone

Question type

Essay

Multiple Choice

Short Answer

True False

Matching

Exam 14: Financial Statement Analysis

Show Answer

Share

---

All types

Filters

Study FlashcardsPractice ExamLearn

Question 31

Multiple Choice

Review LaterAdd Note

Review Later

The numerator in calculating the accounts receivable turnover is

A) total assets
B) sales
C) accounts receivable at year-end
D) average accounts receivable

E) B) and D)
F) B) and C)

Correct Answer

verified

Show Answer

Question 32

Multiple Choice

Review LaterAdd Note

Review Later

The percentage analysis of increases and decreases in individual items in comparative financial statements is called

A) vertical analysis
B) solvency analysis
C) profitability analysis
D) horizontal analysis

E) A) and B)
F) None of the above

Correct Answer

verified

Show Answer

Question 33

True/False

Review LaterAdd Note

The number of days' sales in receivables is one means of expressing the relationship between average daily sales and accounts receivable.

Vertical analysis refers to comparing the financial statements of a single company over several years.

The rate earned on total assets measures the profitability of total assets, without considering how the assets are financed.

In a company's annual report, the section called management discussion and analysis provides critical information in interpreting the financial statements and assessing the future of the company.

Match each ratio that follows to its use (items a-h). Items may be used more than once.

Ratios and various other analytical measures are not a substitute for sound judgment, nor do they provide definitive guides for action.

The following data are taken from the financial statements: Determine for the current year: (a) rate earned on total assets (b) rate earned on stockholders' equity (c) rate earned on common stockholders' equity (d) earnings per share on common stock (e) price-earnings ratio on common stock (f) dividend yield on common stock.  The current market price per share of common  stock is $25. Round percentage values to one decimal place, dollar values to two decimal places, and other ratios to one decimal place.

In horizontal analysis, the current year is the base year.

Revenue and expense data for Bluestem Company are as follows: (a) Prepare a comparative income statement, with vertical analysis, stating each item for both years as a percent of sales. (b) Comment upon significant changes disclosed by the comparative income statement. Round percentages to one decimal place.

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

Based on the following data for the current year, what is the number of days' sales in inventory?

Cash and accounts receivable for Ashfall Co. are provided below: Based on this information, what is the amount and percentage of increase or decrease that would be shown on a balance sheet with horizontal analysis?

A company reports the following: Calculate the company's earnings per share on common stock.

The balance sheets at the end of each of the first two years of operations indicate the following: If net income is $250,000 and interest expense is $30,000 for Year 2, what are the earnings per share on common stock for Year 2?

A loss on disposal of a segment would be reported in the income statement as a(n)

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

A financial statement showing each item on the statement as a percentage of one key item on the statement is called a common-sized financial statement.

Why would you compare or not compare Coca-Cola and Pepsi-Cola (PepsiCo) as companies to each other?