ACCT 212 - EXAM 1 - PROF. KOSS |\ |\ |\ |\ |\ |\ |\ |\
questions with answers |\ |\
what are solvency ratios used for? - CORRECT ANSWERS
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✔✔refers to a company's long-run financial viability and its ability
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to cover long-term obligations
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what are liquidity ratios used for? - CORRECT ANSWERS ✔✔refers
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to the availability of resources to meet short-term cash
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requirements
what are efficiency ratios used for? - CORRECT ANSWERS
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✔✔Efficiency is usually measured relative to how much revenue
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is generated from a certain assets.
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profitability ratios - CORRECT ANSWERS ✔✔refers to a company's
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ability to generate an adequate return on invested capital.
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horizontal analysis - CORRECT ANSWERS ✔✔Comparing a
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company's financial condition and performance across time.
|\ |\ |\ |\ |\ |\
vertical analysis - CORRECT ANSWERS ✔✔Comparing a
|\ |\ |\ |\ |\ |\ |\
company's financial condition and performance to a base
|\ |\ |\ |\ |\ |\ |\ |\
amount.
ratio analysis - CORRECT ANSWERS ✔✔Measurement of key
|\ |\ |\ |\ |\ |\ |\ |\
relations between financial statement items.
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, dollar change - CORRECT ANSWERS ✔✔analysis period amount -
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base period amount
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percent change for horizontal analysis - CORRECT ANSWERS
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✔✔(dollar change/base period amount) x 100
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common size percent for vertical analysis - CORRECT ANSWERS
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✔✔(analysis amount/base amount) x 100 |\ |\ |\ |\
working capital - CORRECT ANSWERS ✔✔current assets - current
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liabilities = working capital
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analysis reporting - CORRECT ANSWERS ✔✔reduces uncertainty
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in business decisions through a rigorous and sound elevation
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for vertical analysis if given a balance sheet what is our base
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amount - CORRECT ANSWERS ✔✔total assets - 100%
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for vertical analysis if given an income statement what is our
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base amount - CORRECT ANSWERS ✔✔total net sales - 100%
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another name for horizontal analysis - CORRECT ANSWERS
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✔✔comparative
another name for vertical analysis - CORRECT ANSWERS
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✔✔common size |\
questions with answers |\ |\
what are solvency ratios used for? - CORRECT ANSWERS
|\ |\ |\ |\ |\ |\ |\ |\ |\
✔✔refers to a company's long-run financial viability and its ability
|\ |\ |\ |\ |\ |\ |\ |\ |\
to cover long-term obligations
|\ |\ |\ |\
what are liquidity ratios used for? - CORRECT ANSWERS ✔✔refers
|\ |\ |\ |\ |\ |\ |\ |\ |\
to the availability of resources to meet short-term cash
|\ |\ |\ |\ |\ |\ |\ |\ |\ |\
requirements
what are efficiency ratios used for? - CORRECT ANSWERS
|\ |\ |\ |\ |\ |\ |\ |\ |\
✔✔Efficiency is usually measured relative to how much revenue
|\ |\ |\ |\ |\ |\ |\ |\ |\
is generated from a certain assets.
|\ |\ |\ |\ |\
profitability ratios - CORRECT ANSWERS ✔✔refers to a company's
|\ |\ |\ |\ |\ |\ |\ |\
ability to generate an adequate return on invested capital.
|\ |\ |\ |\ |\ |\ |\ |\ |\
horizontal analysis - CORRECT ANSWERS ✔✔Comparing a
|\ |\ |\ |\ |\ |\ |\
company's financial condition and performance across time.
|\ |\ |\ |\ |\ |\
vertical analysis - CORRECT ANSWERS ✔✔Comparing a
|\ |\ |\ |\ |\ |\ |\
company's financial condition and performance to a base
|\ |\ |\ |\ |\ |\ |\ |\
amount.
ratio analysis - CORRECT ANSWERS ✔✔Measurement of key
|\ |\ |\ |\ |\ |\ |\ |\
relations between financial statement items.
|\ |\ |\ |\
, dollar change - CORRECT ANSWERS ✔✔analysis period amount -
|\ |\ |\ |\ |\ |\ |\ |\ |\
base period amount
|\ |\
percent change for horizontal analysis - CORRECT ANSWERS
|\ |\ |\ |\ |\ |\ |\ |\
✔✔(dollar change/base period amount) x 100
|\ |\ |\ |\ |\
common size percent for vertical analysis - CORRECT ANSWERS
|\ |\ |\ |\ |\ |\ |\ |\ |\
✔✔(analysis amount/base amount) x 100 |\ |\ |\ |\
working capital - CORRECT ANSWERS ✔✔current assets - current
|\ |\ |\ |\ |\ |\ |\ |\ |\
liabilities = working capital
|\ |\ |\
analysis reporting - CORRECT ANSWERS ✔✔reduces uncertainty
|\ |\ |\ |\ |\ |\ |\
in business decisions through a rigorous and sound elevation
|\ |\ |\ |\ |\ |\ |\ |\
for vertical analysis if given a balance sheet what is our base
|\ |\ |\ |\ |\ |\ |\ |\ |\ |\ |\ |\
amount - CORRECT ANSWERS ✔✔total assets - 100%
|\ |\ |\ |\ |\ |\ |\
for vertical analysis if given an income statement what is our
|\ |\ |\ |\ |\ |\ |\ |\ |\ |\ |\
base amount - CORRECT ANSWERS ✔✔total net sales - 100%
|\ |\ |\ |\ |\ |\ |\ |\ |\
another name for horizontal analysis - CORRECT ANSWERS
|\ |\ |\ |\ |\ |\ |\ |\
✔✔comparative
another name for vertical analysis - CORRECT ANSWERS
|\ |\ |\ |\ |\ |\ |\ |\
✔✔common size |\
