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Exam 12: Financial Statement Analysis

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Question 31

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What is the correct order to present the following items on the income statement?

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Question 32

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The price-earnings (PE)ratio compares a company's share price with its earnings per share.

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Question 33

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Comparing changes in net income for one company over time is an example of:

Assume a company's sales are $1.6 million in 2014,$1.8 million in 2015,and $1.7 million in 2016.What is the percentage change from 2014 to 2015? What is the percentage change from 2015 to 2016? Be sure to indicate whether the percentage change is an increase or a decrease.

Use the following information to answer the next ten questions: Excerpts from TPX Company's December 31,2015 and 2014,financial statements are presented below: -TPX Company's 2015 inventory turnover is:

The financial statements of a firm that uses more conservative accounting practices would be likely to report:

Use the following information to answer the next two questions: Recent financial statement data for Harmony Health Foods (HHF) Inc.is shown below. -HHF's times interest earned ratio is:

Nerf Mania reports net income of $500,000,net sales of $4,000,000,and average assets of $2,000,000.The asset turnover is:

Profit margin measures the income earned on each dollar of sales,and is calculated by dividing net income by net sales.

BC Training reports sales revenue of $2,200,000.Average inventory during the year was $200,000.The inventory turnover ratio for the year is 8.0.What amount of gross profit would the company report in its income statement?

Solvency refers to a company's ability to pay its current liabilities while liquidity refers to a company's ability to pay its long-term liabilities.

Use the following information to answer the next ten questions: Excerpts from TPX Company's December 31,2015 and 2014,financial statements are presented below: -TPX Company's 2015 asset turnover is:

The receivables turnover ratio measures how many times,on average,a company collects its receivables during the year.

The current ratio is calculated as:

Use the following information to answer the next ten questions: Excerpts from Stealth Company's December 31,2015 and 2014,financial statements are presented below: -Stealth Company's 2015 debt to equity ratio is:

LeBron's Kids Camps has a current ratio of 0.75 to 1,based on current assets of $3 million and current liabilities of $4 million.How,if at all,will a $500,000 cash purchase of inventory affect the current ratio? How,if at all,will a $500,000 purchase of inventory on account affect the current ratio?

If the base-year amount is zero,we can't calculate a percentage change under horizontal analysis.

We measure income statement accounts at a point in time and balance sheet accounts over a period of time.

Use the following information to answer the next ten questions: Excerpts from TPX Company's December 31,2015 and 2014,financial statements are presented below: -TPX Company's 2015 average days in inventory is:

Nerf Mania reports net income of $500,000,net sales of $4,000,000,and average assets of $2,000,000.The profit margin is: