WALL STREET PREP FINANCIAL STATEMENT MODELING END OF COURSE STUDY GUIDE LATEST UPDATED ACTUAL TESTED QUESTIONS AND CORRECT ANSWERS

WALL STREET PREP FINANCIAL
STATEMENT MODELING END OF COURSE
STUDY GUIDE LATEST UPDATED ACTUAL
TESTED QUESTIONS AND CORRECT
ANSWERS

⩥ Profitability Ratios.
Answer: measures of a firm's profitability relative to its assets
(operating efficiency) and to its revenue (operating profitability)


⩥ Activity Ratios.
Answer: Measure of efficiency of a firm's assets


⩥ Solvency Ratios.
Answer: Measure of a firm's ability to pay its obligations


⩥ Inventory Turnover.
Answer: COGS / avg inventory


⩥ Receivables Turnover.

,Answer: revenue / average accounts receivable


⩥ DSO (Days Sales Outstanding).
Answer: AR/Credit Sales * days in period
days in period/receivables turnover


⩥ A/P turnover.
Answer: COGS / Average A/P


⩥ PPP (payables purchasing period).
Answer: days in period/ Accounts payable turnover


⩥ Current Ratio.
Answer: current assets/current liabilities


⩥ Quick ratio (acid test).
Answer: Cash and AR divided by current liabilities


⩥ Gross profit margin.
Answer: gross profit/revenue

,⩥ operating margin.
Answer: operating profit/revenue


⩥ net profit margin.
Answer: net income/revenue


⩥ asset turnover.
Answer: revenue/ average assets


⩥ return on assets (ROA).
Answer: Net Income / Average Assets


⩥ return on equity (ROE).
Answer: net income/ total equity


⩥ Basic EPS.
Answer: (Net Income - Preferred Dividends)/(Weighted Average
of Shares Outstanding)

, ⩥ Diluted EPS.
Answer: diluted net income / weighted average diluted shares
outstanding


⩥ dividend yield.
Answer: dividends/net income


⩥ debt to EBITDA.
Answer: Total Debt/EBITDA


⩥ interest coverage ratio.
Answer: EBIT/ interest expense


⩥ fixed charge coverage.
Answer: (EBIT + Lease charges)/(Interest Payments + Lease
charges)


⩥ Debt to Total Assets.
Answer: Total Debt/Total Assets


⩥ debt to equity.