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2.1   LO1: Know the Three Financial Statements Needed for Financial

Question : 2.1   LO1: Know the Three Financial Statements Needed for Financial : 1907270

2.1   LO1: Know the Three Financial Statements Needed for Financial Analysis

1) Using financial information to aid in decision making is called

A) "what-if" analysis.

B) factor analysis.

C) financial analysis.

D) quantitative analysis.

E) managerial economics.

2) Which of the following is not a commonly used source of information for financial analysis?

A) A consultant's analysis of industry conditions

B) Key employees' guesses about future trends

C) The Securities and Exchange Commission's filings

D) The firm's annual report

E) The economic data from a forecasting firm

3) Which of the following is one of the financial statements critical to financial statement analysis?

A) 8-K

B) SEC registration statement

C) Disclosure

D) 10-Q

E) Statement of Cash Flows

4) Which of the following is a variation of the accounting identity?

A) Assets − Fixed assets = Equity − Liabilities

B) Owner's equity = Assets − Liabilities

C) Equity − Liabilities = Assets

D) Assets + Equity = Liabilities

E) Assets + Lease obligations = Equity + Liabilities

5) Balance sheets

A) show how the firm raised funds to purchase assets.

B) report a firm's activities over a period of time.

C) describe a firm's cash flows.

D) provide information about a firm's labor costs.

E) may not balance if the firm suffered a net loss.

6) The right-hand side of the balance sheet shows

A) the cash flow generated by a firm's assets.

B) how the firm financed its assets.

C) the level of accumulated depreciation.

D) profits earned by the firm in the current period.

E) the firm's good will.

7) The ________ is a snapshot of the firm at a particular point in time.

A) income statement

B) statement of cash flows

C) statement of retained earnings

D) balance sheet

E) None of the above

8) An income statement contains all of the following EXCEPT

A) revenues.

B) assets.

C) losses.

D) gains.

E) expenses.

9) Which of the following is not included in a cash flow statement?

A) Labor productivity

B) Interest earnings

C) Cash flow from operations

D) Depreciation expense

E) The increase in long-term debt

1

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