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Exam 13: Analyzing Financial Statements

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Question 81

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An extraordinary gain or loss is one that is both ________________ and _________________.

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Question 82

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External users of financial information:

A) Are those individuals involved in managing and operating the company
B) Include internal auditors and consultants
C) Are not directly involved in operating the company
D) Make strategic decisions for a company
E) Make operating decisions for a company

F) B) and D)
G) B) and C)

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Question 83

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A company paid cash dividends on its preferred stock of $40,000 in the current year when its net income was $120,000 and its average common stockholders' equity was $640,000. What is the company's return on common stockholders' equity?

Given the following information about a corporation's current year activities, answer the questions below: Compute the amounts that should be reported on the income statement as: (1) Income from continuing operations. (2) Income before extraordinary items and cumulative effect of changes in accounting principles. (3) Net income.

A company has a current ratio of 1.92, total liabilities of $193,849, long-term notes payable of $85,791, a quick ratio of .96. What is the total of the current assets for the company?

Guidelines (rules-of-thumb) are developed from:

Comparative horizontal analysis is used to reveal patterns in data covering successive periods.

Quick assets divided by current liabilities is equal to the:

The comparison of a company's financial condition and performance across time is known as:

Selected current year company information follows: Calculate the following company ratios: (a) Profit margin. (b) Total asset turnover. (c) Return on total assets. (d) Return on common stockholders' equity (assume the company has no preferred stock).

A company had a return on common stockholders' equity of 25%. Net income equaled $200,000 and average common stockholders' equity equaled $700,000. Compute the amount of the preferred dividends declared.

Current assets divided by current liabilities is equal to the:

A company has total assets of $5,600,482, common stock of 2,111,111, retained earnings of $1,058,473. What is the company's equity ratio?

The current ratio and acid-test ratio are used to reflect the ____________ of a business.

Working capital is computed as current liabilities minus current assets.

Efficiency refers to how productive a company is in using its assets and is usually measured relative to how much revenue is generated from a certain level of assets.

Trend analysis is a form of horizontal analysis that can reveal patterns in data across successive periods.

A corporation reports the following year-end balance sheet data: Calculate the corporation's current ratio and its acid-test ratio.

_______________ are reports where financial amounts are placed side-by-side in columns on a single statement for analytical purposes.

A company reports basic earnings per share of $3.50, cash dividends per share of $0.75 and a market price per share of $64.75. The company's dividend yield equal is equal to 21.4%.