FiltersDone

Question type

Essay

Multiple Choice

Short Answer

True False

Matching

Exam 16: Financial Statement Analysis

Show Answer

Share

---

All types

Filters

Study FlashcardsPractice ExamLearn

Question 71

Multiple Choice

Review LaterAdd Note

Review Later

Which of the following actions would improve a current ratio of 0.8?

A) Use cash to pay off some current liabilities.
B) Purchase additional marketable securities with cash.
C) Acquire a parcel of land in exchange for common stock.
D) Purchase additional inventory on credit.

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

Correct Answer

verified

Show Answer

Question 72

Multiple Choice

Review LaterAdd Note

Review Later

Laverde Corporation has provided the following data: The company's total asset turnover for Year 2 is closest to:

A) 1.22
B) 7.60
C) 0.13
D) 0.82

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

Correct Answer

verified

Show Answer

Question 73

Essay

Review LaterAdd Note

Abdool Corporation has provided the following financial data: Required:a. What is the company's working capital at the end of Year 2?b. What is the company's current ratio at the end of Year 2?c. What is the company's acid-test (quick) ratio at the end of Year 2?d. What is the company's accounts receivable turnover for Year 2?e. What is the company's average collection period for Year 2?f. What is the company's inventory turnover for Year 2?g. What is the company's average sale period for Year 2?h. What is the company's operating cycle for Year 2?i. What is the company's total asset turnover for Year 2?

All other things the same, if the company purchases equipment on credit, this transaction would have no impact on the company's book value per share.

Tweedle Corporation's most recent balance sheet and income statement appear below: The times interest earned ratio for Year 2 is closest to:

Accounts receivable turnover will normally decrease as a result of:

Jester Corporation's most recent income statement appears below: The beginning balance of total assets was $230,000 and the ending balance was $223,000. The return on total assets is closest to:

A company could improve its acid-test ratio by selling some equipment it no longer needs for cash.

Delfavero Corporation has provided the following data: The company's earnings per share for Year 2 is closest to:

Freiman Corporation's most recent balance sheet and income statement appear below: The acid-test (quick) ratio at the end of Year 2 is closest to:

Excerpts from Sydner Corporation's most recent balance sheet appear below: Sales on account in Year 2 amounted to $1,390 and the cost of goods sold was $900.The acid-test (quick) ratio at the end of Year 2 is closest to:

Kaloi Corporation has provided the following financial data: Dividends on common stock during Year 2 totaled $3,500. The market price of common stock at the end of Year 2 was $7.46 per share.Required:a. What is the company's working capital at the end of Year 2?b. What is the company's current ratio at the end of Year 2?c. What is the company's acid-test (quick) ratio at the end of Year 2?d. What is the company's accounts receivable turnover for Year 2?e. What is the company's average collection period for Year 2?f. What is the company's inventory turnover for Year 2?g. What is the company's average sale period for Year 2?h. What is the company's operating cycle for Year 2?i. What is the company's total asset turnover for Year 2?j. What is the company's times interest earned ratio for Year 2?k. What is the company's debt-to-equity ratio at the end of Year 2?l. What is the company's equity multiplier at the end of Year 2?m. What is the company's net profit margin percentage for Year 2?n. What is the company's gross margin percentage for Year 2?o. What is the company's return on total assets for Year 2?p. What is the company's return on equity for Year 2?

The acid-test ratio is usually greater than the current ratio.

Excerpts from Sydner Corporation's most recent balance sheet appear below: Sales on account in Year 2 amounted to $1,390 and the cost of goods sold was $900. (Round your intermediate calculations to 2 decimal places.) The average collection period for Year 2 is closest to:

Two-Rivers Incorporated (TRI) manufactures a variety of consumer products. The company's founders have run the company for thirty years and are now interested in retiring. Consequently, they are seeking a purchaser, and a group of investors is looking into the acquisition of Two-Rivers Incorporated (TRI). To evaluate its financial stability,Two-Rivers Incorporated(TRI) was requested to provide its latest financial statements and selected financial ratios. Summary information provided byTwo-Rivers Incorporated(TRI) is presented below. Required:a. Calculate the select financial ratios for the fiscal year Year 2.b. Interpret what each of these financial ratios means in terms of Two-Rivers Incorporated's(TRI's) financial stability and operating efficiency.

Garrott Corporation's total assets were $1,505,000 at the end of Year 2 and $1,520,000 at the end of Year 1. Its total stockholders' equity was $1,197,000 at the end of Year 2 and $1,180,000 at the end of Year 1. The company's gross margin percentage for Year 2 is closest to:

Guttery Corporation has provided the following financial data from its balance sheet: Sales on account in Year 2 totaled $1,450,000 and cost of goods sold totaled $900,000.The company's average sale period for Year 2 is closest to: (Round your intermediate calculations to 2 decimal places.)

Excerpts from Sydner Corporation's most recent balance sheet appear below: Sales on account in Year 2 amounted to $1,390 and the cost of goods sold was $900.The current ratio at the end of Year 2 is closest to:

Deacon Corporation has provided the following financial data from its balance sheet and income statement: The company's debt-to-equity ratio at the end of Year 2 is closest to:

When fixed costs are included in the cost of goods sold, the gross margin percentage should increase and decrease with sales volume.