Working With Financial Statements

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Questions Bank

Introduction to Corporate Finance
Financial Statements,Taxes,and Cash Flow
Working With Financial Statements
Long-Term Financial Planning and Growth
Introduction to Valuation: The Time Value of Money
Discounted Cash Flow Valuation
Interest Rates and Bond Valuation
Stock Valuation
Net Present Value and Other Investment Criteria
Making Capital Investment Decisions
Project Analysis and Evaluation
Some Lessons From Capital Market History
Return,Risk,and the Security Market Line
Cost of Capital
Raising Capital
Financial Leverage and Capital Structure Policy
Dividends and Payout Policy
Short-Term Finance and Planning
Cash and Liquidity Management
Credit and Inventory Management
International Corporate Finance
Behavioral Finance: Implications for Financial Management
Enterprise Risk Management
Options and Corporate Finance
Option Valuation
Mergers and Acquisitions
Leasing

All Questions

Question 1

Free

Multiple Choice

Activities of a firm which require the spending of cash are known as:

Choose correct answer/s

sources of cash.

uses of cash.

cash collections.

cash receipts.

cash on hand.

Check answer

Question 2

Free

Multiple Choice

The sources and uses of cash over a stated period of time are reflected on the:

Choose correct answer/s

income statement.

balance sheet.

tax reconciliation statement.

statement of cash flows.

statement of operating position.

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Question 3

Free

Multiple Choice

A common-size income statement is an accounting statement that expresses all of a firm's expenses as percentage of:

Choose correct answer/s

total assets.

total equity.

net income.

taxable income.

sales.

Check answer

Question 4

Free

Multiple Choice

Which one of the following standardizes items on the income statement and balance sheet relative to their values as of a chosen point in time?

Choose correct answer/s

statement of standardization

statement of cash flows

common-base year statement

common-size statement

base reconciliation statement

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Question 5

Free

Multiple Choice

Relationships determined from a firm's financial information and used for comparison purposes are known as:

Choose correct answer/s

financial ratios.

identities.

dimensional analysis.

scenario analysis.

solvency analysis.

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Question 6

Multiple Choice

The formula which breaks down the return on equity into three component parts is referred to as which one of the following?

Choose correct answer/s

equity equation

profitability determinant

SIC formula

Du Pont identity

equity performance formula

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Question 7

Multiple Choice

The U.S.government coding system that classifies a firm by the nature of its business operations is known as the:

Choose correct answer/s

NASDAQ 100.

Standard & Poor's 500.

Standard Industrial Classification code.

Governmental ID code.

Government Engineered Coding System.

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Question 8

Multiple Choice

Which one of the following is a source of cash?

Choose correct answer/s

increase in accounts receivable

decrease in notes payable

decrease in common stock

increase in accounts payable

increase in inventory

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Question 9

Multiple Choice

Which one of the following is a use of cash?

Choose correct answer/s

increase in notes payable

decrease in inventory

increase in long-term debt

decrease in accounts receivables

decrease in common stock

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Question 10

Multiple Choice

Which one of the following is a source of cash?

Choose correct answer/s

repurchase of common stock

acquisition of debt

purchase of inventory

payment to a supplier

granting credit to a customer

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Question 11

Multiple Choice

Which one of the following is a source of cash?

Choose correct answer/s

increase in accounts receivable

decrease in common stock

decrease in long-term debt

decrease in accounts payable

decrease in inventory

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Question 12

Multiple Choice

On the Statement of Cash Flows,which of the following are considered financing activities?
I)increase in long-term debt
II)decrease in accounts payable
III)interest paid
IV)dividends paid

Choose correct answer/s

I and IV only

III and IV only

II and III only

I, III, and IV only

I, II, III, and IV

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Question 13

Multiple Choice

On the Statement of Cash Flows,which of the following are considered operating activities?
I)costs of goods sold
II)decrease in accounts payable
III)interest paid
IV)dividends paid

Choose correct answer/s

I and III only

III and IV only

I, II, and III only

I, III, and IV only

I, II, III, and IV

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Question 14

Multiple Choice

According to the Statement of Cash Flows,a decrease in accounts receivable will _ the cash flow from _ activities.

Choose correct answer/s

decrease; operating

decrease; financing

increase; operating

increase; financing

increase; investment

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Question 15

Multiple Choice

According to the Statement of Cash Flows,an increase in interest expense will _ the cash flow from _ activities.

Choose correct answer/s

decrease; operating

decrease; financing

increase; operating

increase; financing

increase; investment

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Question 16

Multiple Choice

On a common-size balance sheet all accounts are expressed as a percentage of:

Choose correct answer/s

sales for the period.

the base year sales.

total equity for the base year.

total assets for the current year.

total assets for the base year.

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Question 17

Multiple Choice

On a common-base year financial statement,accounts receivables will be expressed relative to which one of the following?

Choose correct answer/s

current year sales

current year total assets

base-year sales

base-year total assets

base-year accounts receivables

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Question 18

Multiple Choice

A firm uses 2011 as the base year for its financial statements.The common-size,base-year statement for 2012 has an inventory value of 1.08.This is interpreted to mean that the 2012 inventory is equal to 108 percent of which one of the following?

Choose correct answer/s

2011 inventory

2011 total assets

2012 total assets

2011 inventory expressed as a percent of 2011 total assets

2012 inventory expressed as a percent of 2012 total assets

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Question 19

Multiple Choice

Which of the following ratios are measures of a firm's liquidity?
I)cash coverage ratio
II)interval measure
III)debt-equity ratio
IV)quick ratio

Choose correct answer/s

I and III only

II and IV only

I, III, and IV only

I, II, and III only

I, II, III, and IV

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Question 20

Multiple Choice

An increase in current liabilities will have which one of the following effects,all else held constant? Assume all ratios have positive values.

Choose correct answer/s

increase in the cash ratio

increase in the net working capital to total assets ratio

decrease in the quick ratio

decrease in the cash coverage ratio

increase in the current ratio

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Working With Financial Statements

Activities of a firm which require the spending of cash are known as:

The sources and uses of cash over a stated period of time are reflected on the:

A common-size income statement is an accounting statement that expresses all of a firm's expenses as percentage of:

Which one of the following standardizes items on the income statement and balance sheet relative to their values as of a chosen point in time?

Relationships determined from a firm's financial information and used for comparison purposes are known as:

The formula which breaks down the return on equity into three component parts is referred to as which one of the following?

The U.S.government coding system that classifies a firm by the nature of its business operations is known as the:

Which one of the following is a source of cash?

Which one of the following is a use of cash?

Which one of the following is a source of cash?

Which one of the following is a source of cash?

On the Statement of Cash Flows,which of the following are considered financing activities?I)increase in long-term debtII)decrease in accounts payableIII)interest paidIV)dividends paid

On the Statement of Cash Flows,which of the following are considered operating activities?I)costs of goods soldII)decrease in accounts payableIII)interest paidIV)dividends paid

According to the Statement of Cash Flows,a decrease in accounts receivable will _____ the cash flow from _____ activities.

According to the Statement of Cash Flows,an increase in interest expense will _____ the cash flow from _____ activities.

On a common-size balance sheet all accounts are expressed as a percentage of:

On a common-base year financial statement,accounts receivables will be expressed relative to which one of the following?

A firm uses 2011 as the base year for its financial statements.The common-size,base-year statement for 2012 has an inventory value of 1.08.This is interpreted to mean that the 2012 inventory is equal to 108 percent of which one of the following?

Which of the following ratios are measures of a firm's liquidity?I)cash coverage ratioII)interval measureIII)debt-equity ratioIV)quick ratio

An increase in current liabilities will have which one of the following effects,all else held constant? Assume all ratios have positive values.

On the Statement of Cash Flows,which of the following are considered financing activities?
I)increase in long-term debt
II)decrease in accounts payable
III)interest paid
IV)dividends paid

On the Statement of Cash Flows,which of the following are considered operating activities?
I)costs of goods sold
II)decrease in accounts payable
III)interest paid
IV)dividends paid

According to the Statement of Cash Flows,a decrease in accounts receivable will _ the cash flow from _ activities.

According to the Statement of Cash Flows,an increase in interest expense will _ the cash flow from _ activities.

Which of the following ratios are measures of a firm's liquidity?
I)cash coverage ratio
II)interval measure
III)debt-equity ratio
IV)quick ratio