It is easier to evaluate a firm using financial statements when the firm:
Topic: The Production Process and Costs Quiz ( MCQ and Answer )
Which one of the following statements is correct?
A firm currently has $600 in debt for every $1,000 in equity. Assume the firm uses some of its cash to decrease its debt while maintaining its current equity and net income. Which one of the following will decrease as a result of this action?
Which one of the following accurately describes the three parts of the Du Point identity?
Shareholders probably have the most interest in which one of the following sets of ratios?
The price-sales ratio is especially useful when analyzing firms that have which one of the following?
Tobin’s Q relates the market value of a firm’s assets to which one of the following?
Al’s has a price-earnings ratio of 18.5. Ben’s also has a price-earnings ratio of 18.5. Which one of the following statements must be true if Al’s has a higher PEG ratio than Ben’s?
Which one of the following will decrease if a firm can decrease its operating costs, all else constant?
If a firm produces a twelve percent return on assets and also a twelve percent return on equity, then the firm:
Ratios that measure how efficiently a firm manages its assets and operations to generate net income are referred to as _____ ratios.
Dee’s has a fixed asset turnover rate of 1.12 and a total asset turnover rate of 0.91. Sam’s has a fixed asset turnover rate of 1.15 and a total asset turnover rate of 0.88. Both companies have similar operations. Based on this information, Dee’s must be doing which one of the following?
The Corner Hardware has succeeded in increasing the amount of goods it sells while holding the amount of inventory on hand at a constant level. Assume that both the cost per unit and the selling price per unit also remained constant. This accomplishment will be reflected in the firm’s financial ratios in which one of the following ways?
Jasper United had sales of $21,000 in 2008 and $24,000 in 2009. The firm’s current accounts remained constant. Given this information, which one of the following statements must be true?
The cash coverage ratio directly measures the ability of a firm’s revenues to meet which one of its following obligations?
If a firm has a debt-equity ratio of 1.0, then its total debt ratio must be which one of the following?
Which one of the following statements is correct?
Ratios that measure a firm’s financial leverage are known as ____ ratios.
Over the past year, the quick ratio for a firm increased while the current ratio remained constant. Given this information, which one of the following must have occurred? Assume all ratios have positive values.
A firm has an interval measure of 48. This means that the firm has sufficient liquid assets to do which one of the following?
A supplier, who requires payment within ten days, should be most concerned with which one of the following ratios when granting credit?
An increase in which one of the following will increase a firm’s quick ratio without affecting its cash ratio?