Scribd Logo
Upload

Welcome to Scribd!

  • Seatwork 2

    Uploaded by

    Ryan Malanum Abrio
    6 views3 pages
    This document contains a series of multiple choice questions that test understanding of key financial ratios used to analyze the liquidity and financial health of a company. These include: 1. Vertical analysis, horizontal analysis, common-size analysis and ratio analysis as techniques for financial statement analysis. 2. Current ratio, acid-test ratio, and accounts receivable turnover ratio as liquidity ratios to measure a company's short-term debt paying ability. 3. Inventory turnover ratio to measure how many times on average inventory is sold in a year. 4. A set of additional questions that calculate liquidity ratios like current ratio and acid-test ratio based on financial information provided about a company's cash, inventory

    Original Description:

    Original Title

    Seatwork2

    Copyright

    © © All Rights Reserved

    Available Formats

    DOCX, PDF, TXT or read online from Scribd

    Did you find this document useful?

    Is this content inappropriate?

    Report this Document
    This document contains a series of multiple choice questions that test understanding of key financial ratios used to analyze the liquidity and financial health of a company. These include: 1. Vertical analysis, horizontal analysis, common-size analysis and ratio analysis as techniques for financial statement analysis. 2. Current ratio, acid-test ratio, and accounts receivable turnover ratio as liquidity ratios to measure a company's short-term debt paying ability. 3. Inventory turnover ratio to measure how many times on average inventory is sold in a year. 4. A set of additional questions that calculate liquidity ratios like current ratio and acid-test ratio based on financial information provided about a company's cash, inventory

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Flag for inappropriate content
    6 views3 pages

    Seatwork 2

    Uploaded by

    Ryan Malanum Abrio
    This document contains a series of multiple choice questions that test understanding of key financial ratios used to analyze the liquidity and financial health of a company. These include: 1. Vertical analysis, horizontal analysis, common-size analysis and ratio analysis as techniques for financial statement analysis. 2. Current ratio, acid-test ratio, and accounts receivable turnover ratio as liquidity ratios to measure a company's short-term debt paying ability. 3. Inventory turnover ratio to measure how many times on average inventory is sold in a year. 4. A set of additional questions that calculate liquidity ratios like current ratio and acid-test ratio based on financial information provided about a company's cash, inventory

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Flag for inappropriate content
    of 3

    Multiple Choice: Conceptual

    1. It expresses line items or accounts in the financial statements as


    percentages.

    a. Common-size Analysis
    b. Horizontal Analysis
    c. Vertical Analysis
    d. Ratio Analysis
    2. Also called as trend analysis, expresses a line item as a percentage of
    some prior-period amount.

    a. Common-size Analysis
    b. Horizontal Analysis
    c. Vertical Analysis
    d. Ratio Analysis
    3. Expresses the line item as a percentage of some other line item for the
    same period.

    a. Common-size Analysis
    b. Horizontal Analysis
    c. Vertical Analysis
    d. Ratio Analysis
    4. It is the second major technique for financial statement analysis.

    a. Common-size Analysis
    b. Horizontal Analysis
    c. Vertical Analysis
    d. Ratio Analysis
    5. It is used to assess the short-term debt-paying ability of a company.

    a. Liquidity Ratio
    b. Current Ratio
    c. Acid-test Ratio
    d. Accounts receivable turnover ratio
    6. A measure of the ability of a company to pay its short-term liabilities
    out of short-term assets.

    a. Liquidity Ratio
    b. Current Ratio
    c. Acid-test Ratio
    d. Accounts receivable turnover ratio
    7. A measure of liquidity that compares only the most liquid assets with
    current liabilities.

    a. Liquidity Ratio
    b. Current Ratio
    c. Acid-test Ratio
    d. Accounts receivable turnover ratio

    Chapter 1 - Page 1
    8. Measures the liquidity of receivables or how long it takes for the
    entity to turn its receivables into cash

    a. Liquidity Ratio
    b. Current Ratio
    c. Acid-test Ratio
    d. Accounts receivable turnover ratio
    9. It tells how many times the average inventory turns over, or is sold,
    during the year.

    a. Inventory turnover ratio


    b. Current Ratio
    c. Acid-test Ratio
    d. Accounts receivable turnover ratio
    10. What is the formula for current ratio?

    a. Current assets/Current liabilities


    b. (Cash + Marketable securities +Accounts receivable)/Current
    liabilities
    c. Net credit sales/Ave. accounts receivable
    d. Cost of goods sold/Ave. inventory

    Calculate the different liquidity ratios from the following particulars

    Particulars Amount

    Cash 100,000

    Inventory(Average) ?

    Accounts 50,000
    Receivable (Average)

    Current Liabilities 100,000


    Current Assets 250,000
    Accounts receivable 2.0
    turnover ratio

    Inventory turnover 0.7


    ratio

    11. Current Ratio


    a. 2.1
    b. 1.5
    c. 2.0
    d. 2.5

    12. Inventory

    Chapter 1 - Page 2
    a. 100,000
    b. 150,000
    c. 50,000
    d. 250,000
    13. Net Credit Sales
    a. 100,000
    b. 150,000
    c. 50,000
    d. 250,000
    14. Cost of Goods Sold
    a. 100,000
    b. 150,000
    c. 50,000
    d. 70,000
    15. Acid-test ratio
    a. 2.1
    b. 1.5
    c. 2.0
    d. 2.5

    Chapter 1 - Page 3

    You might also like