Financial Analysis, Finance And Accounting

Question: Which is the primary financial statement used to measure profitability?
A
Balance Sheet

B
Income Statement

C
Cash Flow Statement

D
Statement of Retained Earnings

Note: Not available
1. Report
Question: What is operating leverage defined as?
A
Extent to which variable costs are utilized

B
Extent to which fixed assets are utilized

C
Extent to which fixed assets and fixed costs are utilized

D
Extent to which fixed costs are utilized

E
Extent to which prices change

Note: Not available
1. Report
Question: Which report does a publicly traded company file quarterly with the SEC?
A
8K

B
10K

C
10Q

D
Prospectus

Note: Not available
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Question: If a company using financing has a 60% chance of a $75,000 return under normal conditions but a 40% chance of a $20,000 return when money is tight and borrowing costs are higher, what is the expected return for this firm ?
A
$75,000

B
$60,000

C
$53,000

D
$40,000

E
$20,000

Note: Not available
1. Report
Question: What is one caveat when calculating ROA and comparing to other companies?
A
Asset values change over time

B
Carrying value of assets may be valued differently (historical, market) by different companies

C
Liabilities vary month to month making this ratio difficult to track accurately

D
Every financial analyst calculates it differently making comparison useless

Note: Not available
1. Report
Question: Which is/are the primary financial statements used to measure stability?
A
Balance Sheet

B
Income Statement

C
Balance Sheet and Income Statement

D
Statement of Cash Flows and Income Statement

Note: Not available
1. Report
Question: Which ratio would you use to assess a company's ability to pay bills?
A
Interest coverage ratio

B
Times interest earned ratio

C
Price earnings ratio

D
Current ratio

E
Profit margin

Note: Not available
1. Report
Question: In breakeven analysis, if fixed costs rise, then the breakeven point will __________.
A
fall

B
rise

C
stay the same

D
none of these

Note: Not available
1. Report
Question: Firm A has a Return on Equity (ROE) equal to 24%, while firm B has a ROE of 15% during the same year. Both firms have a total debt ratio (D/V) equal to 0.8. Firm A has an asset turnover ratio of 0.9, while firm B has an asset turnover ratio equal to 0.4. From this, it can be assessed that ______.
A
Firm A has a higher profit margin than firm B

B
Firm B has a higher profit margin than firm A

C
Firm A and B have the same profit margin

D
Firm A has a higher equity multiplier than firm B

E
more information is needed to say anything about the firm's profit margin

Note: Not available
1. Report
Question: In 2002, the US passed the Sarbanes-Oxley law which ____.
A
did not change any function of the Boards of Directors of publicly traded corporations

B
gave the Financial Accounting Standards Board the oversight responsibility for public auditing firms

C
does not change the responsibilities of independent auditors

D
was developed in response to the accounting scandals at Enron, Tyco, WorldCom and others

E
protects senior executives from prosecution for accounting fraud if they are unaware of its existence

Note: Not available
1. Report

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Question: Which is the primary financial statement used to measure profitability?

Question: What is operating leverage defined as?

Question: Which report does a publicly traded company file quarterly with the SEC?

Question: If a company using financing has a 60% chance of a $75,000 return under normal conditions but a 40% chance of a $20,000 return when money is tight and borrowing costs are higher, what is the expected return for this firm ?

Question: What is one caveat when calculating ROA and comparing to other companies?

Question: Which is/are the primary financial statements used to measure stability?

Question: Which ratio would you use to assess a company's ability to pay bills?

Question: In breakeven analysis, if fixed costs rise, then the breakeven point will __________.

Question: In 2002, the US passed the Sarbanes-Oxley law which ____.