Question

1.Horizontal analysis

a.is used to determine the company's horizon.

b. measures the percentage difference in an account or group of accounts in the same company between the beginning and the end of an accounting period.

c.uses net sales as a 100% base figure.

d.is only used to compare companies of different sizes.

e. allows an investor to form common-sized income statements.

2.The reason for calculating the quick ratio (current assets less inventory and prepaid expenses) is

a.to provide a measure of immediate debt-paying ability by a company.

b.the ratio is required by the Securities and Exchange Commission in financial statements submitted by publicly-held companies.

c.the ratio gives a measure of the company's ability to purchase fixed assets in the next accounting period.

d.stockholders use the quick ratio to understand how much their dividend will be in the next accounting period.

e.the quick ratio is a required figure in determining total stockholders' equity.

3.Managerial accounting

a.produces financial statements that must be in accordance with GAAP.

b.pertains to historical data only.

c.is performed by personnel considered to be in a line department/division.

d.None of the above answers is correct.

4.Manufacturing organizations have how many inventories reported on their balance sheets?

a.0

b.1

c.2

d.3

Answer 1

1.Horizontal analysis

b. measures the percentage difference in an account or group of accounts in the same company between the beginning and the end of an accounting period.

2.The reason for calculating the quick ratio (current assets less inventory and prepaid expenses) is

a.to provide a measure of immediate debt-paying ability by a company.

3.Managerial accounting

d.None of the above answers is correct.

4.Manufacturing organizations have how many inventories reported on their balance sheets?

d.3