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Which of the following is calculated by dividing net sales revenue by average net receivables?


A) Days to sell ratio
B) Current ratio
C) Profit margin
D) Receivables turnover ratio

E) All of the above
F) C) and D)

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A company provided the following information: A company provided the following information: There was no change in contributed capital and there were no dividends declared in the current year. Required: Calculate the return on equity ratio. There was no change in contributed capital and there were no dividends declared in the current year. Required: Calculate the return on equity ratio.

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Ending Retained Earnings = Beginning Ret...

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The following information pertains to Chestnut,Inc.: The following information pertains to Chestnut,Inc.: What would be reported next to Interest Expense on a common sized income statement? A) 12.7% B) 1.7% C) 0.6% D) 0.9% What would be reported next to Interest Expense on a common sized income statement?


A) 12.7%
B) 1.7%
C) 0.6%
D) 0.9%

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

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To analyze changes in a company's sales over the last five years,you should perform:


A) vertical analysis.
B) ratio analysis.
C) horizontal analysis.
D) cross-sectional analysis.

E) A) and D)
F) C) and D)

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Kingsbury Manufacturing has net sales revenue of $624,000,cost of goods sold of $274,560,and all other expenses of $262,080.The gross profit percentage is closest to:


A) 32%.
B) 56%.
C) 86%.
D) 14%.

E) B) and C)
F) A) and B)

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The higher the times interest earned ratio,the greater the risk of nonpayment of interest.

A) True
B) False

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Hussain,Inc.'s income statement and other financial information for the current year is presented below. Hussain,Inc.'s income statement and other financial information for the current year is presented below. Required: Part a.Perform vertical analysis of the income statement.(Round to the nearest whole percentage. ) Part b.Calculate the debt-to-assets ratio.(Round to two decimal places. ) Part c.Calculate the times interest earned ratio.(Round to two decimal places. ) Part d.Evaluate the company's solvency. Hussain,Inc.'s income statement and other financial information for the current year is presented below. Required: Part a.Perform vertical analysis of the income statement.(Round to the nearest whole percentage. ) Part b.Calculate the debt-to-assets ratio.(Round to two decimal places. ) Part c.Calculate the times interest earned ratio.(Round to two decimal places. ) Part d.Evaluate the company's solvency. Required: Part a.Perform vertical analysis of the income statement.(Round to the nearest whole percentage. ) Part b.Calculate the debt-to-assets ratio.(Round to two decimal places. ) Part c.Calculate the times interest earned ratio.(Round to two decimal places. ) Part d.Evaluate the company's solvency.

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Part a
Hussain,Inc.
Income Statement
For...

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The following information is taken from the financial statements of Clybourn Company for the current year: The following information is taken from the financial statements of Clybourn Company for the current year: The gross profit percentage for the current year rounded to the nearest whole percent is closest to: A) 24%. B) 76%. C) 60%. D) 31%. The gross profit percentage for the current year rounded to the nearest whole percent is closest to:


A) 24%.
B) 76%.
C) 60%.
D) 31%.

E) A) and D)
F) A) and C)

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Judging only from the ratios below,which of the following clothing wholesalers is least likely to be having cash flow problems?


A) Company A: Receivable turnover of 5;inventory turnover of 2
B) Company B: Receivable turnover of 2;inventory turnover of 5
C) Company C: Receivable turnover of 10;inventory turnover of 10
D) Company D: Receivable turnover of 1;inventory turnover of 1

E) A) and D)
F) A) and C)

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A company has a debt-to-assets ratio of 0.45 and a return on equity ratio of 10%.If the company then issues additional shares of common stock for cash,which of the following is a correct statement?


A) The debt-to-assets ratio will decrease and the return on equity ratio will decrease.
B) The debt-to-assets ratio will increase and the return on equity ratio will increase.
C) The debt-to-assets ratio will not change and the return on equity ratio will not change.
D) The debt-to-assets ratio will decrease and the return on equity ratio will increase.

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

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Horizontal analysis is the comparison of each financial statement amount to another amount on the same financial statement.

A) True
B) False

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Which of the following statements about liquidity and solvency ratios is correct?


A) Unlike solvency ratios,liquidity ratios relate to the company's long-run survival.
B) Both liquidity ratios and solvency ratios measure a company's ability to meet its financial obligations.
C) Liquidity ratios include the return on equity ratio and the times interest earned ratio.
D) Solvency ratios include the current ratio and the net profit margin ratio.

E) A) and B)
F) A) and C)

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Which of the following is a profitability measure?


A) Net income ÷ Revenues
B) Total assets ÷ Total stockholders' equity
C) Total liabilities ÷ Total stockholders' equity
D) Cost of goods sold ÷ Average inventory

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

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Puffin Turnovers,Inc.'s fixed asset turnover was 0.9 while Muffin Tops,Inc.'s fixed asset turnover was 0.6.Which of the following statements about Puffin compared with Muffin is correct?


A) Puffin generated more sales per dollar of fixed assets.
B) Puffin has greater depreciation expense.
C) Puffin has more fixed assets.
D) Puffin has greater sales.

E) A) and C)
F) B) and C)

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A times interest earned ratio of 11 means that the company's:


A) net income is large enough to pay interest and taxes 11 times.
B) net cash flow from operations before taxes and interest is large enough to pay interest and taxes 11 times.
C) net cash flow from operations is large enough to pay interest and taxes 11 times.
D) income before taxes and interest is large enough to pay interest 11 times.

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

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A current ratio of 2.5 means that for every dollar of:


A) accounts payable,there is $2.50 of cash.
B) current liabilities,there is $2.50 of current assets.
C) current assets,there is $2.50 of current liabilities.
D) total liabilities,there is $2.50 of cash.

E) A) and B)
F) A) and C)

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Which of the following ratios is calculated by dividing current assets by current liabilities?


A) Quick ratio
B) Solvency ratio
C) Debt ratio
D) Current ratio

E) A) and D)
F) A) and B)

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Mercedes,Co.has the following quarterly financial information. Mercedes,Co.has the following quarterly financial information. Required: Part a.Calculate the gross profit percentage for each quarter. Part b.Calculate the net profit margin for each quarter. Part c.Calculate the EPS for each quarter. Part d.Calculate the Price/Earnings ratio at the end of the year. Part e.Evaluate the company's profitability. Round all ratios to two decimal places. Required: Part a.Calculate the gross profit percentage for each quarter. Part b.Calculate the net profit margin for each quarter. Part c.Calculate the EPS for each quarter. Part d.Calculate the Price/Earnings ratio at the end of the year. Part e.Evaluate the company's profitability. Round all ratios to two decimal places.

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Part a
Gross profit percentage = [(Net s...

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If net sales revenue for a retail chain has been relatively constant for the last four years,but the fixed asset turnover has been decreasing,what would be the most likely cause?


A) The number of stores has expanded.
B) Cost of Goods sold has been increasing.
C) Employee wages have been increasing.
D) The company has closed some of its stores.

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

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Sheffield Company has $145,000 of inventory at the beginning of the year and $131,000 at the end of the year.Sales revenue is $1,972,800,cost of goods sold is $1,145,400,and net income is $248,400 for the year.The inventory turnover ratio is:


A) 1.8.
B) 8.3.
C) 6.0.
D) 14.3.

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

Correct Answer

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Showing 41 - 60 of 141

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