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Exam 14: Financial Statement Analysis

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Question 81

Multiple Choice

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A company with $70,000 in current assets and $50,000 in current liabilities pays a $1,000 current liability.As a result of this transaction,the current ratio and working capital will

A) both decrease
B) both increase
C) increase and remain the same,respectively
D) remain the same and decrease,respectively

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

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Question 82

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The following information pertains to Dallas Company.Assume that all balance sheet amounts represent both average and ending balance figures and that all sales were on credit. Assets Liabilities and Stockholders' Equity Income Statement ​ What is the return on stockholders' equity?

A) 7.3%
B) 13.6%
C) 20.5%
D) 40.9%

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

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Question 83

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Zeus Company reports the following for the current year: ​ *Net of any tax effect ​

Which of the following would appear as an unusual item on the income statement?

A company reports the following: ​ Determine the (a)return on stockholders' equity,and (b)return on common stockholders' equity.Round your answer to one decimal place.

Which of the following is not a characteristic evaluated in ratio analysis?

Match each ratio that follows to its use (items a-h) .Items may be used more than once. -price-earnings (P / E) ratio

The denominator of the return on total assets ratio is the average total assets.

A loss on disposal of a segment would be reported in the income statement as a(n)

When the return on total assets is greater than the return on common stockholders' equity,the management of the company has effectively used leverage.

If two companies have the same current ratio,their ability to pay short-term debt is the same.

The following items were taken from the financial statements of Tilden,Inc.,over a three-year period: ​ ​ Compute the following for each of the items listed. ​ Round percentages to one decimal place.

The following data are taken from the financial statements: ​ ​ Determine for the current year the (a)return on total assets,(b)return on stockholders' equity,(c)return on common stockholders' equity,(d)earnings per share on common stock,(e)price-earnings ratio on common stock,and (f)dividend yield.The current market price per share of common stock is $25. Round dollar values to two decimal places and other final answers to one decimal place.

A company reports the following income statement and balance sheet information for the current year: ​ Determine the return on total assets.Round your answer to one decimal place.

Horizontal analysis of comparative financial statements includes

A balance sheet that displays only component percentages is a

A company reports the following: ​ Calculate the company's earnings per share on common stock.

What is the asset turnover for Diane Company?

Which of the following is not included in the computation of the quick ratio?

The dividend yield is equal to the dividends per share divided by the par value per share of common stock.