Nomor

Mahasiswa:

A Quiz _ FS Analysis (15 minutes)

6. Which of the following statements is correct?
1. The base amount in preparing component a. If gross profit percentage increases from
percentages for an income statement is usually one year to the next, then the net income
which of the following? percentage will also increase from one
a. Income from operations. year to the next.
b. Net income. b. If gross profit percentage is the same for
c. Net sales. the current and past year, then sales and
d. Gross profit. cost of goods sold in dollars did not
change.
2. Which ratio reflects the stock market's c. When cost of goods sold as a percentage
assessment of a company's future of sales increases, the gross profit
performance? percentage will decrease.
a. Dividend yield ratio. d. When cost of goods sold as a percentage
b. Fixed asset turnover ratio of sales increases, the gross profit
c. Cash coverage ratio. percentage will increase.
d. Price/earnings ratio.
7. Return on equity (ROE) by the DuPont model is
3. Which of the following transactions a function of these ratios below, except :
decreases the quality of income ratio? a. Net profit margin
a. Selling inventory on account for a profit. b. Return on assets
b. Making a payment of principal on a loan c. Financial leverage
c. The accrual of interest expense. d. Price/Earning
d. Collecting cash on an account
receivable. 8. Bailey Corporation reported the following
information for 2019:
4. A company can improve (lower) its debt-to- Net income $10,000
total assets ratio by doing which of the Total assets 16,000
following? Total stockholders’ equity 8,000

a. Borrow more
What is Bailey's debt-to-equity ratio?
b. Sell common stock a. 3
c. Shift short-term to long-term debt b. 2
d. Shift long-term to short-term debt c. 1.25
d. 1.0
5. Ankara Co. reported net income of $8.3
million, interest expense of $0.5 million and 9. Which of the following ratios is not an
$0.2 million of income tax expense. Wildlife's indicator of a company's short-term financial
average total assets are $65.8 million and strength?
average stockholders' equity is $48.6 million. a. Quality of income
Wildlife's times interest earned ratio is closest b. Current ratio.
to: c. Cash ratio
a. 45 times d. Quick ratio.
b. 41.5 times
c. 18 times
d. 6 times



Nomor Mahasiswa:

10. A firm has a higher quick (or acid test) ratio 14. Which of the accounting ratios considers the
than the industry average, which implies. importance of cash flows relating to required
a. the firm may be less profitable than interest payments?
a. Times interest earned.
other firms in the industry.
b. Cash coverage.
b. The firm is more likely to avoid c. Quick ratio.
insolvency in short run than other firms d. Debt-to-equity.
in the industry.
c. the firm is more efficient than other 15. Which of the following would NOT improve
firms in the industry. the current ratio?
d. None of the above a. Sell fixed assets to reduce account
payable
11. The records of Marshall Company include the b. Borrow short term to finance additional
following: fixed asset
c. Issue long-term debt to buy inventory
Average total assets $760,000 d. Sell common stock to reduce current
Average total liablities 485,000
liabilities
Total revenue 200,500
Total expense 135,000

The return on equity is closest to:
a. 8,4% --00--
b. 13.2%.
c. 23,8%.
d. 24,0%.

12. A firm has a lower asset turnover ratio than

the industry average, which implies:

a. The firm has lower spending on new fixed

assets than other firms in the industry
b. The firm is less profitable than other firms
in the industry
c. The firm is utilizing assets less efficiently
than other firm in the industry

d. The firm is less likely to avoid insolvency
in the short run than other firms in the
industry

13. Which of the following ratios will not