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Exam 13: Financial Analysis: The Big Picture

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Question 51

Multiple Choice

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The following information pertains to Unique Company.Assume that all balance sheet amounts represent both average and ending balance figures.Assume that all sales were on credit. What is the accounts receivable turnover for this company?

A) 2.8 times
B) 2 times
C) 3.4 times
D) 3 times

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Question 52

Multiple Choice

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The following information pertains to Unique Company.Assume that all balance sheet amounts represent both average and ending balance figures.Assume that all sales were on credit. What is the return on assets for this company?

A) 6.8%
B) 10.0%
C) 11.7%
D) 26.7%

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Question 53

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Vertical analysis is a technique for evaluating a series of financial statement data over a period of time to determine the increase (decrease) that has taken place.

Comparisons of financial data made within a company are called

Long-term creditors are usually most interested in evaluating

The current ratio is a measure of all the ratios calculated for the current year.

Solvency is of most interest to

The current ratio would be of most interest to

Which of the following would be considered an "Other Comprehensive Income" item?

Tito Corporation had net income of $2,000,000 and paid dividends to common stockholders of $300,000 in 2022.The weighted average number of shares outstanding in 2022 was 400,000 shares.Tito Corporation's common stock is selling for $50 per share on the NASDAQ.Tito Corporation's price-earnings ratio is

A change in accounting principle occurs when the principle used in the current year is different from the one used by competitors in the current year.

Which one of the following ratios would not likely be used by a short-term creditor in evaluating whether to sell on credit to a company?

Chodron Corporation had net credit sales of $13,000,000 and cost of goods sold of $9,250,000 for the year.The average inventory for the year amounted to $1,250,000.The average days in inventory during the year was approximately

Junebag Corporation reported net income $24,000; net sales $400,000; and average assets $600,000 for 2022.What is the 2022 profit margin?

The following information pertains to Blue Flower Company.Assume that all balance sheet amounts represent both average and ending balance figures.Assume that all sales were on credit. What is the accounts receivable turnover for this company?

Which one of the following is not a liquidity ratio?

Return on common stockholders' equity is most closely related to

Salamagundi, Inc.has the following Income Statement (in millions) : Using vertical analysis, what percentage is assigned to gross profit?

Net sales are $3,250,000, beginning total assets are $1,400,000, and the asset turnover is 2.5 times.What is the ending total asset balance?

The best way to study the relationship of the components within a financial statement is to prepare