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67.              In performing a vertical analysis, the base for sales

Question : 67.              In performing a vertical analysis, the base for sales : 1311995

 

 

67.              In performing a vertical analysis, the base for sales revenues on the income statement is

a.net sales.

b.sales.

c.net income.

d.cost of goods available for sale.

 

 

68.              In performing a vertical analysis, the base for sales returns and allowances is

a.sales.

b.sales discounts.

c.net sales.

d.total revenues.

 

 

69.              In performing a vertical analysis, the base for cost of goods sold is

a.total selling expenses.

b.net sales.

c.total revenues.

d.total expenses.

 

 

70.              Each of the following is a liquidity ratio except the

a.acid-test ratio.

b.current ratio.

c.debt to total assets ratio.

d.inventory turnover.

 

 

71.              A ratio calculated in the analysis of financial statements

a.expresses a mathematical relationship between two numbers.

b.shows the percentage increase from one year to another.

c.restates all items on a financial statement in terms of dollars of the same purchasing power.

d.is meaningful only if the numerator is greater than the denominator.

 

 

72.              A liquidity ratio measures the

a.income or operating success of an enterprise over a period of time.

b.ability of the enterprise to survive over a long period of time.

c.short-term ability of the enterprise to pay its maturing obligations and to meet unexpected needs for cash.

d.number of times interest is earned.

 

 

73.              The current ratio is

a.calculated by dividing current liabilities by current assets.

b.used to evaluate a company's liquidity and short-term debt paying ability.

c.used to evaluate a company's solvency and long-term debt paying ability.

d.calculated by subtracting current liabilities from current assets.

 

 

74.              The acid-test (quick) ratio

a.is used to quickly determine a company's solvency and long-term debt paying ability.

b.relates cash, short-term investments, and net receivables to current liabilities.

c.is calculated by taking one item from the income statement and one item from the balance sheet.

d.is the same as the current ratio except it is rounded to the nearest whole percent.

 

 

75.              Harvey Clothing Store had a balance in the Accounts Receivable account of $390,000 at the beginning of the year and a balance of $410,000 at the end of the year. Net credit sales during the year amounted to $3,000,000. The average collection period of the receivables in terms of days was

a.30 days.

b.365 days.

c.274 days.

d.48.7 days.

 

 

76.              Parker Hardware Store had net credit sales of $8,000,000 and cost of goods sold of $5,000,000 for the year. The Accounts Receivable balances at the beginning and end of the year were $600,000 and $700,000, respectively. The receivables turnover was

a.7.7 times.

b.4.6 times.

c.11.4 times.

d.12.3 times.

 

 

 

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