Chapter 03 Financial Statements Analysis and Long-Term Planning Answer Key
Multiple Choice Questions
1. One key reason a long-term financial plan is developed is becau:
A. the plan determines your financial policy.
B. the plan determines your investment policy.
C. there are direct connections between achievable corporate growth and the financial policy.
D. there is unlimited growth possible in a well-developed financial plan.
E. None of the above.
Difficulty level: Easy
Topic: LONG-TERM PLANNING
Type: DEFINITIONS
2. Projected future financial statements are called:
A. plug statements.
B. pro forma statements.
C. reconciled statements.
D. aggregated statements.
E. none of the above.
Difficulty level: Easy
Topic: PRO FORMA STATEMENTS
Type: DEFINITIONS
3. The percentage of sales method:
A. requires that all accounts grow at the same rate.
B. parates accounts that vary with sales and tho that do not vary with sales.
C. allows the analyst to calculate how much financing the firm will need to support the predicted sales level.
D. Both A and B.
E. Both B and C.
Difficulty level: Medium
Topic: PERCENTAGE OF SALES
Type: DEFINITIONS
through the rain
4. A _____ standardizes items on the income statement and balance sheet as a percentage of total sales and total asts, respectively.
A. tax reconciliation statement
B. statement of standardization
C. statement of cash flows
D. common-ba year statement
E. common-size statement
Difficulty level: Easy
Topic: COMMON-SIZE STATEMENTS
Type: DEFINITIONS
5. Relationships determined from a firm's financial information and ud for comparison purpos are known as:
A. financial ratios.
B. comparison statements.
C. dimensional analysis.
D. scenario analysis.
E. solvency analysis.
Difficulty level: Easy
iscsiTopic: FINANCIAL RATIOS
Type: DEFINITIONS
6. Financial ratios that measure a firm's ability to pay its bills over the short run without undue stress are known as _____ ratios.
上海领科国际学校官网
A. ast management
B. long-term solvency
C. short-term solvencysomeone like you歌词翻译
D. profitability
E. market value
Difficulty level: Easy
Topic: SHORT-TERM SOLVENCY RATIOS
aspenType: DEFINITIONS
7. The current ratio is measured as:
A. current asts minus current liabilities.
B. current asts divided by current liabilities.
C. current liabilities minus inventory, divided by current asts.
D. cash on hand divided by current liabilities.
E. current liabilities divided by current asts.
Difficulty level: Easy华尔街英语培训价格
Topic: CURRENT RATIO
Type: DEFINITIONS
8. The quick ratio is measured as:
激烈的
A. current asts divided by current liabilities.
B. cash on hand plus current liabilities, divided by current asts.
C. current liabilities divided by current asts, plus inventory.
D. current asts minus inventory, divided by current liabilities.
E. current asts minus inventory minus current liabilities.
Difficulty level: Easy
Topic: QUICK RATIO
Type: DEFINITIONS
9. The cash ratio is measured as:
A. current asts divided by current liabilities.
B. current asts minus cash on hand, divided by current liabilities.
C. current liabilities plus current asts, divided by cash on hand.
D. cash on hand plus inventory, divided by current liabilities.
E. cash on hand divided by current liabilities.
Difficulty level: Medium
Topic: CASH RATIO
Type: DEFINITIONS
10. Ratios that measure a firm's financial leverage are known as _____ ratios.
A. ast management
B. long-term solvency
C. short-term solvency
D. profitability
E. market value
Difficulty level: Easy
Topic: LONG-TERM SOLVENCY RATIOS
Type: DEFINITIONS
11. The financial ratio measured as total asts minus total equity, divided by total asts, is the:
A. total debt ratio.
B. equity multiplier.
C. debt-equity ratio.
D. current ratio.
E. times interest earned ratio.
汕头翻译公司
Difficulty level: Easy
Topic: TOTAL DEBT RATIO
Type: DEFINITIONS
12. The debt-equity ratio is measured as total:
A. equity minus total debt.
B. equity divided by total debt.
C. debt divided by total equity.
D. debt plus total equity.
E. debt minus total asts, divided by total equity.
Difficulty level: Easy
偶像爸爸
Topic: DEBT-EQUITY RATIO
Type: DEFINITIONS
李阳疯狂英语网站
13. The equity multiplier ratio is measured as total:
A. equity divided by total asts.
B. equity plus total debt.
