Question 1

Spartacus Inc.,has sales of $4,500,000,net income of $250,000,assets worth $3,700,000,and total common stockholder equity of $2,500,000.The ROE for Spartacus is:

Accepted Answer

A)  5.56%.
B)  6.76%.
C)  10.00%.
D)  55.56%.

Question 2

A firm's Return on Equity (ROE) measures

Accepted Answer

A)  its profitability relative to its total assets.
B)  its profitability relative to its equity investment.
C)  its return on sales.
D)  its debt to equity ratio.

Question 3

Which of the following statements about EBIT and EBITDA margins is TRUE?

Accepted Answer

A)  EBIT and EBITDA ratios are one of the few sets of ratios that tend to be the same across almost all industries.
B)  These ratios tell the firm what percentage of sales dollars are available to cover interest,taxes,and to provide a return to stockholders.
C)  These measures are useful for internal analysis but not for external analysis.
D)  These measures are useful for external analysis but not for internal analysis.

Question 4

________ ratios are a form of leverage-related ratios.

Accepted Answer

A)  Profitability
B)  Liquidity
C)  Market
D)  Coverage

Question 5

Explain how to create a common size income statement and a common size balance sheet.Provide at least three reasons why analysts find the creation of common size statements to be a useful practice.

Accepted Answer

The student should understand that each ...

Exam 4: Measuring Financial Performance

Which of the following statements about EBIT and EBITDA margins is TRUE?

Correct Answer
verified

Explain how to create a common size income statement and a common size balance sheet.Provide at least three reasons why analysts find the creation of common size statements to be a useful practice.

Correct Answer
verified
The student should understand that each ...
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________ ratios are a form of leverage-related ratios.

Correct Answer
verified

Spartacus Inc.,has sales of $4,500,000,net income of $250,000,assets worth $3,700,000,and total common stockholder equity of $2,500,000.The ROE for Spartacus is:

Correct Answer
verified

A firm's Return on Equity (ROE) measures

Correct Answer
verified

Exam 4: Measuring Financial Performance

Which of the following statements about EBIT and EBITDA margins is TRUE?

Correct AnswerverifiedShow Answer

Explain how to create a common size income statement and a common size balance sheet.Provide at least three reasons why analysts find the creation of common size statements to be a useful practice.

Correct AnswerverifiedThe student should understand that each ...View AnswerShow Answer

________ ratios are a form of leverage-related ratios.

Correct AnswerverifiedShow Answer

Spartacus Inc.,has sales of $4,500,000,net income of $250,000,assets worth $3,700,000,and total common stockholder equity of $2,500,000.The ROE for Spartacus is:

Correct AnswerverifiedShow Answer

A firm's Return on Equity (ROE) measures

Correct AnswerverifiedShow Answer

Correct Answer
verified

Correct Answer
verified
The student should understand that each ...
View Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified