ACC 561 Week 2 Quiz 115. The relationship between current assets and current liabilities is important in evaluating a company’s market value. solvency. profitability. liquidity. 116. Which of the following is a measure of liquidity? Debt to equity ratio Profit margin Working capital Earnings per shar 117. Current assets divided by current liabilities is known as the capital structure. working capital current ratio. profit margin. 88. Danner Corporation reported net sales of $600,000, $680,000, and $800,000 in the years 2011, 2012, and 2013, respectively. If 2011 is the base year, what percentage do 2013 sales represent of the base? 33% 133% 75% 113% 89 .An analyzing financial statements, horizontal analysis is a theory. requirement. tool. principle. 101. Comparative balance sheets are usually prepared for at least one year. are usually prepared for at least two years. do not show both dollar amount and percentage changes. do not show a comparison of total stockholders’ equity. 102. Assume the following cost of goods sold data for a company: 2013 $1,500,000 2012 1,200,000 2011 1,000,000 If 2011 is the base year, what is the percentage increase in cost of goods sold from 2011 to 2013? 50% 67% 150% 20% 105. Comparisons of data within a company are an example of the following comparative basis: Intercompany. Interregional. Industry averages. Intracompany. 123. The following schedule is a display of what type of analysis? Amount Percent Current assets $100,000 25% Property, plant, and equipment 300,000 75% Total assets $400,000 100% Horizontal analysis Differential analysis Vertical analysis Ratio analysis 129. A common measure of profitability is the current ratio. debt to total assets. current cash debt coverage ratio. return on common stockholders’ equity ratio. 134. Which one of the following would be considered a long-term solvency ratio? Return on total assets Current cash debt coverage ratio Debt to total assets ratio Receivables turnover 137. The current ratio is calculated by dividing current liabilities by current assets. used to evaluate a company’s liquidity and short-term debt paying ability. used to evaluate a company’s solvency and long-term debt paying ability. calculated by subtracting current liabilities from current assets. 121.Richards, Inc. has the following income statement (in millions): RICHARDS, INC. Income Statement For the Year Ended December 31, 2012 Net Sales $180 Cost of Goods Sold 60 Gross Profit 120 Operating Expenses 75 Net Income $ 45 Using vertical analysis, what percentage is assigned to net income? A.100% B.75% C.25% D.None of the above.
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