ACC 232 Final Exam

ACC 232 Final Exam Which of the following is an example of horizontal analysis? A. Comparing COGS with sales. B. Comparing net income across companies. C. Comparing debt with equity. D. Comparing the growth in sales over time. D Which of the following is correct? A. Receivables turnover ratio depicts the company's frequency of cash collections. B. Inventory turnover ratio can be used to assess the company's frequency of selling inventory. C. Current ratio reflects the company's ability to pay current debt. D. All of the other options are correct. D Which of the following ratios is most useful in evaluating liquidity? A. Return on assets. B. Return on equity. C. Times interest earned ratio. D. Current ratio. D Which of the following ratios is most useful in evaluating solvency? A. Debt to equity ratio. B. Current ratio. C. Receivables turnover ratio. D. Inventory turnover ratio. A Which of the following is a sign that a company can quickly turn its receivables into cash A. A low receivables turnover ratio. B. A high receivables turnover ratio. C. A high average collection period. D. Both a low receivables turnover ratio and a high average collection period. B Which of the following is a negative sign that a company is not selling its inventory quickly? A. A low inventory turnover ratio. B. A high inventory turnover ratio. C. A low average days in inventory. D. Both a high inventory turnover ratio and a low average days in inventory. A The debt ratio is the relationship between: A. Current assets and current liabilities. B. Current assets and total liabilities. C. Total assets and total liabilities. D. Total assets and current liabilities. C Common stockholders usually have all of the following rights except: A. To receive dividends when declared. B. To share in the distribution of assets.