21) What a firms times interest earned if it posts

Question : 21) What a firms times interest earned if it posts : 1907273

21) What is a firms times interest earned if it posts revenues of $200,000, taxes of $35,000, expenses of $100,000, and interest of $30,000

A) 3.3 times

B) 2.0 times

C) 2.2 times

D) 0.5 times

E) 1.3 times

22) If a firm's total asset turnover is low, but its fixed asset turnover is high, which of the following ratios should an analyst examine to locate the source of the problem?

A) Debt/equity

B) Price/earnings

C) Return on equity

D) Accounts receivable turnover

E) Times interest earned

23) A firm has sales of $1 million, net income of $250,000, total current assets of $300,000, and accounts receivable of $200,000. The firm's accounts receivable turnover is

A) 0.33 times.

B) 0.20 times.

C) 1.50 times.

D) 5.00 times.

E) 1.25 times.

24) A firm has accounts receivable of $150,000. During the year, total sales are $500,000, of which $300,000 are cash sales. What is the average collection period?

A) 109.5 days

B) 182.5 days

C) 273.8 days

D) 486.7 days

E) None of the above

25) What is a firm's debt ratio if its total assets are $135,000, equity is $75,000, current liabilities are $24,000, and total liabilities are $105,000?

A) 140%

B) 110%

C) 50%

D) 60%

E) 78%

26) Market ratios differ from other ratios because

A) they are based on information not contained in the firm's financial statements.

B) they are the only ratios that may have negative values.

C) they are the most important ratios to shareholders.

D) they are the only ratios that relate equity measures to other variables.

E) they are less precise.

27) If a firm has 100,000 shares of common stock outstanding and has just recorded a $45,000 profit, what is its price/earnings ratio if its current share price is $35?

A) 0.78

B) 0.45

C) 14.00

D) 45.00

E) 78.00

28) The DuPont analysis calculates ROE as the product of

A) leverage, market value, and turnover.

B) margin, turnover, and leverage.

C) profitability, liquidity, and leverage.

D) activity, leverage, and debt.

E) margin, profitability, and leverage.

29) All of the following are part of a financial analysis EXCEPT

A) examining the strengths and weaknesses of the firm.

B) performing a means-end analysis.

C) calculating the DuPont ratio.

D) analyzing the competition.

E) performing an industry analysis.

30) Ratio interaction refers to

A) using multiple ratios to make a decision.

B) the way ratios are affected by managerial decisions.

C) how ratios affect managerial decisions.

D) the effect one ratio has on another.

E) when a ratio raises a red flag for analysts.

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Finance 3 Years Ago 266 Views
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