Which one of the following accurately describes the three parts of the Du Pont identity? Show A. operating efficiency, equity multiplier, and profitability ratio B. financial leverage, operating efficiency, and profitability ratio C. equity multiplier, profit margin, and total asset turnover D. debt-equity ratio, capital intensity ratio, and profit margin E. return on assets, profit margin, and equity multiplier Activities of a firm which require the spending of cash are known as: A. sources of cash. B. uses of cash. C. cash collections. D. cash receipts. E. cash on hand. The sources and uses of cash over a stated period of time are reflected on the: A. income statement. B. balance sheet. C. tax reconciliation statement. D. statement of cash flows. E. statement of operating position. A common-size income statement is an accounting statement that expresses all of a firm's expenses as percentage of: A. total assets. B. total equity. C. net income. D. taxable income. E. sales. Which one of the following standardizes items on the
income statement and balance sheet relative to their values as of a common point in time? A. statement of standardization B. statement of cash flows C. common-base year statement D. common-size statement E. base reconciliation statement Common-base year statement Relationships determined from a firm's financial information and used for comparison purposes are known as: A.
financial ratios. B. identities. C. dimensional analysis. D. scenario analysis. E. solvency analysis. The formula which breaks down the return on equity into three component parts is referred to as which one of the following? A. equity equation B. profitability determinant C. SIC formula D. Du Pont identity E. equity performance formula The U.S.
government coding system that classifies a firm by the nature of its business operations is known as the: A. NASDAQ 100. B. Standard & Poor's 500. C. Standard Industrial Classification code. D. Governmental ID code. E. Government Engineered Coding System. Standard Industrial Classification code Which one of the following is a source of
cash? A. increase in accounts receivable B. decrease in notes payable C. decrease in common stock D. increase in accounts payable E. increase in inventory Increase in accounts payable Which one of the following is a use of cash? A. increase in notes payable B. decrease in inventory C. increase in long-term debt D. decrease in accounts receivables E. decrease in common stock
Which one of the following is a source of cash? A. repurchase of common stock B. acquisition of debt C. purchase of inventory D. payment to a supplier E. granting credit to a customer Which one of the following is a source of cash? A. increase in accounts receivable B. decrease in common stock C. decrease in long-term debt D. decrease in accounts payable E. decrease in inventory
On the Statement of Cash Flows, which of the following are considered financing activities? I. increase in long-term debt II. decrease in accounts payable III. interest paid IV. dividends paid A. I and IV only B. III and IV only C. II and III only On the Statement of Cash Flows, which of the following are considered operating activities? I. costs of goods sold II. decrease in
accounts payable III. interest paid IV. dividends paid A. I and III only B. III and IV only C. I, II, and III only According to the Statement of Cash Flows, a decrease in accounts receivable will _____ the cash flow from _____ activities. A. decrease; operating B. decrease; financing C. increase; operating D. increase; financing E. increase; investment According to the
Statement of Cash Flows, an increase in interest expense will _____ the cash flow from _____ activities. A. decrease; operating B. decrease; financing C. increase; operating D. increase; financing E. increase; investment On a common-size balance sheet all accounts are expressed as a percentage of: A. sales for the period. B. the base year sales. C. total equity for the base year. D. total assets for the
current year. E. total assets for the base year. Total assets for the current year On a common-base year financial statement, accounts receivables will be expressed relative to which one of the following? A. current year sales B. current year total assets C. base-year sales D. base-year total assets E. base-year accounts receivables Base-year accounts receivables A firm uses 2008 as the base year for its financial statements. The common-size, base-year statement for 2009 has an inventory value of 1.08. This is interpreted to mean that the 2009 inventory is equal to 108 percent of which one of the following? B. 2008 total assets 2008 inventory expressed as a percent of 2008 total assets Which of the following ratios are measures of a firm's liquidity? I. cash coverage ratio II. interval measure III. debt-equity ratio IV. quick ratio A. I and III only B. II and IV only C. I, III, and IV only An increase in current liabilities will have which one of the following effects, all else held constant? Assume all ratios have positive values. A. increase in the cash ratio B. increase in the net working capital to total assets ratio C. decrease in the quick ratio D. decrease in the cash coverage ratio E. increase in the current ratio Decrease in the quick ratio An increase in which one of the following will increase a firm's quick ratio without affecting its cash ratio? A. accounts payable B. cash C. inventory D. accounts receivable E. fixed assets A supplier, who requires payment within ten days, should be most concerned with which one of the following ratios when granting credit? A. current B. cash C. debt-equity D. quick E. total debt A firm has an interval measure of 48. This means that the firm has sufficient liquid assets to do which one of the following? A. pay all of its debts that are due within the next 48 hours B. pay all of its debts that are due within the next 48 days C. cover its operating costs for the next 48 hours D. cover its operating costs for the next 48 days Cover its operating costs for the next 48 days Over the past year, the quick ratio for a firm increased while the current ratio remained constant. Given this information, which one of the following must have occurred? Assume all ratios have positive values. A. current assets increased B. current assets decreased C. inventory increased D. inventory decreased E. accounts payable increased Ratios that measure a firm's financial leverage are known as _____ ratios. A. asset management B. long-term solvency C. short-term solvency D. profitability E. book value Which one of the following statements is correct? B. Long-term creditors would prefer the times interest earned ratio be 1.4 rather than 1.5. C. The debt-equity ratio can be computed as 1 plus the equity multiplier.
D. An equity multiplier of 1.2 means a firm has $1.20 in sales for every $1 in equity. E. An increase in the depreciation expense will not affect the cash coverage ratio. An increase in the depreciation expense will not affect the cash coverage ratio If a firm has a debt-equity ratio of 1.0, then its total debt ratio must be which one of the following? A. 0.0 B. 0.5 C. 1.0
D. 1.5 E. 2.0 The cash coverage ratio directly measures the ability of a firm's revenues to meet which one of its following obligations? A. payment to supplier B. payment to employee C. payment of interest to a lender D. payment of principle to a lender E. payment of a dividend to a shareholder Payment of interest to a lender Jasper United had sales of $21,000 in 2008 and $24,000 in 2009. The firm's current accounts remained constant. Given this information, which one of the following statements must be true? A. The total asset turnover rate increased. B. The days' sales in receivables increased. C. The net working capital turnover rate increased. D. The fixed asset turnover decreased. E. The receivables turnover rate decreased. The net working capital turnover rate increased The Corner Hardware has succeeded in increasing the amount of goods it sells while holding the amount of inventory on hand at a constant level. This accomplishment will be reflected in the firm's financial ratios in which one of the following ways? C. no change in the fixed asset turnover rate D. decrease in the day's sales in inventory E. no change in the total asset turnover rate Decrease in the day's sales in inventory Dee's has a fixed asset turnover rate of 1.12 and a total asset turnover rate of 0.91. Sam's has a fixed asset turnover rate of 1.15 and a total asset turnover rate of 0.88. Both companies have similar operations. Dee's must be doing which one of the following? A. utilizing its fixed assets more efficiently than Sam's B. utilizing its total assets more efficiently than Sam's C. generating $1 in sales for every $1.12 in net fixed assets Utilizing its total assets more efficiently than Sam's Ratios that measure how efficiently a firm manages its assets and operations to generate net income
are referred to as _____ ratios. A. asset management B. long-term solvency C. short-term solvency D. profitability E. turnover If a firm produces a twelve percent return on assets and also a twelve percent return on equity, then the firm: A. may have short-term, but not long-term debt. B. is using its assets as efficiently as possible. C. has no net working capital. D. has a debt-equity ratio of 1.0. E.
has an equity multiplier of 1.0. Has an equity multiplier of 1.0 Which one of the following will decrease if a firm can decrease its operating costs, all else constant? A. return on equity B. return on assets C. profit margin D. equity multiplier E. price-earnings ratio Al's has a price-earnings ratio of 18.5. Ben's also has a price-earnings ratio of 18.5. Which one of the following statements must be true if Al's has a higher PEG ratio than Ben's? A. Al's has more net income than Ben's. B. Ben's is increasing its earnings at a faster rate than the Al's. C. Al's has a higher market value per share than does Ben's. Ben's is increasing its earnings at a faster rate than Al's Which of the following are the sources of cash for a firm?The most common sources of cash for a business are accounts receivable, inventory, and investments. Other sources of cash include loans from banks or other lenders, lines of credit, and advances from customers.
Which is the following is a source of cash?
Which one of the following is an analysis of a firm's sources and uses of cash over a period of time?48 Cards in this Set. Which of the following is a source of cash flows *?issue of shares for cash is an external source of cash flow, as cash received form issue of shares will be considered as source of cash.
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The sources and uses of cash over a stated period of time are reflected on the:
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