ACCOUNTING 234 CORE 2 QUIZ 1 |COMPLETE QUESTIONS WITH EXPERT
SOLUTION | 2026 LATEST UPDATED GET A+
1. Why is conducting an analysis of a company's financial ratios
beneficial? Question 1 options: a)
It is a central component of value-chain analysis.
b)
It identifies external opportunities for the company to pursue.
c)
It uncovers critical industry trends.
d)
It provides insights into a company's financial state.: It provides insights into
a company's financial state.
2. You, CPA, are concerned about one of your firm's clients, Farm Acre
Foods Inc. (Farm). Although very profitable, you suspect that Farm may be
experiencing problems paying off short-term debt. Which one of the
following analytical review calculations will highlight this concern?
,Question 2 options:
a)
Gross profit percentage
b)
Inventory turnover ratio
c)
Quick ratio
d)
Times interest earned: Quick ratio
3. Which of the following statements for financial statement analysis is
true? Question 3 options: a)
A high debt-to-equity ratio is a negative qualitative factor.
b)
A high gross-margin-percentage ratio is a negative qualitative factor.
c)
A high dividend-payout ratio is positive qualitative factor.
, d)
A high days-payable-outstanding ratio is a positive qualitative factor.: A high
debt-to-equity ratio is a negative qualitative factor.
4. Which of the following scenarios best represents a possible increase in cash
for the year? Question 4 options: a)
A redemption of term deposits
b)
A decrease in accounts payable
c)
A purchase of term deposits
d)
Advances to related parties: A redemption of
term deposits 5. During the year, LMN Inc. had:
sales of $2,500,000 gross profit of $1,000,000
net income of $125,000
SOLUTION | 2026 LATEST UPDATED GET A+
1. Why is conducting an analysis of a company's financial ratios
beneficial? Question 1 options: a)
It is a central component of value-chain analysis.
b)
It identifies external opportunities for the company to pursue.
c)
It uncovers critical industry trends.
d)
It provides insights into a company's financial state.: It provides insights into
a company's financial state.
2. You, CPA, are concerned about one of your firm's clients, Farm Acre
Foods Inc. (Farm). Although very profitable, you suspect that Farm may be
experiencing problems paying off short-term debt. Which one of the
following analytical review calculations will highlight this concern?
,Question 2 options:
a)
Gross profit percentage
b)
Inventory turnover ratio
c)
Quick ratio
d)
Times interest earned: Quick ratio
3. Which of the following statements for financial statement analysis is
true? Question 3 options: a)
A high debt-to-equity ratio is a negative qualitative factor.
b)
A high gross-margin-percentage ratio is a negative qualitative factor.
c)
A high dividend-payout ratio is positive qualitative factor.
, d)
A high days-payable-outstanding ratio is a positive qualitative factor.: A high
debt-to-equity ratio is a negative qualitative factor.
4. Which of the following scenarios best represents a possible increase in cash
for the year? Question 4 options: a)
A redemption of term deposits
b)
A decrease in accounts payable
c)
A purchase of term deposits
d)
Advances to related parties: A redemption of
term deposits 5. During the year, LMN Inc. had:
sales of $2,500,000 gross profit of $1,000,000
net income of $125,000
