Question

TRUE/FALSE

- Simply calculating the various ratios tells everything you need to know about a company.
- You would expect a produce market to have a low inventory turnover ratio.
- The Acid Test Ratio uses only the most liquid current assets in its calculation.
- The Current Ratio uses only the most liquid current assets in its calculation.
- The Inventory Turnover Ratio indicates the number of times Accounts Receivable are turned into cash during the period.
- The Return on Sales Ratio indicates how much income a company earns on each dollar of sales.
- Debt management ratios measure how well a company is using debt versus its equity position.
- The Average Collection Period indicates the number of days that it takes a business to collect its accounts receivable.
- The Inventory Turnover Ratio indicates the number of times a company sells or turns over its average amount of inventory per year.

MULTIPLE CHOICE

- Which type of ratio is NOT used in calculating financial ratios?

- Liquidity Ratios
- Trigonometric Ratios.
- Asset Management Ratios.
- Debt Management Ratios.
- Profitability Ratios.

- Quick assets are

- Assets that can be easily be turned into cash.
- Assets that are pledged to creditors.
- Assets that are reserved for making interest payments.
- Assets that increase in value over time.
- Assets that are depreciable.

Answer #1

As per the guidelines for an expert, I am supposed to answer only one question in a single post. You need to post again for the rest to get answers

(i) Q Which type of ratio is NOT used in calculating financial ratios?

Ans (b) Trigonometric Ratios

Because Financial Ratios does not include any Trigonometic Ratios

(ii) Quick assets are

Ans (a) Assets that can be easily be turned into cash.

Because this ratio is about how many times of Current Liabilities are Liquid Assets in a company.

Give a short explanation of your conclusions about Barnes and
Noble after each category of ratios (i.e. How liquid is the
company? How efficiently is it using its assets? etc.).
Liquidity and Efficiency
Current Ratio
= Current assets / Current liabilities
1.45
Acid-test ratio
= Cash + Short-term investments + Current receivables / Current
liabilities
0.27
Accounts receivable turnover
= Net sales / Average accounts receivable, net
20.52
times
Inventory turnover
= Cost of goods sold / Average inventory
6.45...

Question 8. (Calculating financial ratios) Use the balance sheet
and income statement for the J. P. Robard Mfg. Company to calculate
the following ratios: (Show all work.)
Current ratio (Round to two decimal places.) _________
Times interest earned (Round to two decimal places) ________
times
Inventory turnover (Round to two decimal places.) __________
times
Total asset turnover (Round to two decimal places.)
__________
Operating profit margin (Round to one decimal places.)
___________%
Operating return on assets (Round to one decimal...

Ratios Compared with Industry Averages - Company X manufactures
various plastic and synthetic products. Financial statement data
for the firm is as follows:
2015
($ thousands, except Earnings per Share)
Sales revenue
$815,000
Cost of goods sold
540,000
Net income
50,500
Dividends
14,000
Earnings per share
4.04
COMPANY X
BALANCE SHEETS
($ IN THOUSANDS)
DEC. 31, 2015
DEC. 31, 2014
ASSETS
Cash
$4,100
$2,700
Accounts receivable (net)
66,900
60,900
Inventory
148,000
140,000
TOTAL CURRENT ASSETS
219,000
203,600
Plant assets (net)...

Q9 to Q12- Write the formula for the following ratios and what
each ratio measures:
Return on equity (ROE)
Return on assets (ROA)
Gross profit
Gross margin
Profit margin (also called the “net profit margin”)
Asset turnover
Fixed-Asset Turnover
Inventory Turnover
Inventory Period (also called “days inventory
outstanding”)
Collection Period (also called “account receivable
period”)
Payables Period (also called “account payable period”)
Operating Cycle
Cash Conversion Cycle
Financial Leverage (also called “equity multiplier” )
Debt-to-assets ratio
Debt-to-equity ratio
Times interest...

I need to calculate the following information for Allscripts
(MDRX) but I do not know how.
1. Liquidity of Short-Term Assets
Current Ratio
Cash Ratio
Quick Ratio
2. Long-Term Debt-paying Ability
Debt Ratio
Debt-equity Ratio
Times Interest Earned
3. Profitability
Net Income / Sales (Profit Margin)
Net Income / Assets (ROA)
Net Income / Shareholder Equity (ROE)
4. Asset Utilization / Management Efficiency
Total Asset Turnover
Inventory Turnover Measures
Accounts Receivable Turnover
5. Market Measures
Price / Earnings Ratio
Earnings...

(Pro
forma balance sheet
construction)
Use the following industry-average ratios to construct a pro
forma balance sheet for Karen's Beauty Products, Inc.:
(Pro
forma balance sheet
construction)
Use the following industry-average ratios to construct a pro
forma balance sheet for Karen's Beauty Products, Inc.:
Total asset turnover
1.6
times
Average collection period (assume 365-day year)
14
days
Fixed asset turnover
6
times
Inventory turnover (based on cost of goods sold)
3
times
Current ratio
1.9
times
Sales (all on credit)...

Which of the following statements is CORRECT?
Select one:
a. The days sales outstanding ratio tells us how long it takes,
on average, to collect after a sale is made. The account collection
period (ACP) can be compared with the firm's credit terms to get an
idea of whether customers are paying on time.
Last year Harrington Inc. had sales of $325,000 and a net income
of $19,000, and its year-end assets were $250,000. The firm's
total-debt-to-total-assets ratio was 67.5%....

The comparative statements of Cullumber Company are presented
here.
CULLUMBER COMPANY
Income Statements
For the Years Ended December 31
2022
2021
Net sales
$1,894,200
$1,755,700
Cost of goods sold
1,063,575
1,011,200
Gross profit
830,625
744,500
Selling and administrative expenses
505,200
484,200
Income from operations
325,425
260,300
Other expenses and losses
Interest expense
23,500
21,500
Income before income taxes
301,925
238,800
Income tax expense
93,065
74,500
Net income
$ 208,860
$ 164,300
CULLUMBER COMPANY
Balance Sheets
December 31
Assets
2022
2021...

Answer true or false to the following
statements 7. The current ratio is a measure of all the
ratios calculated for the current year.
8. Inventory turnover measures the number of
times on the average the inventory was sold during the period.
9. Profitability ratios are frequently used as a basis
for evaluating management's operating effectiveness.
10. The rate of return on total assets will be
greater than the rate of return on common stockholders' equity if
the company has been successful in trading...

1. Which of the following is not a true statement about
effective ratio analysis?
Ratios should NOT be used to compare across time or across
firms. Ratios should be analyzed in isolation.
Ratios are used by Managers to help evaluate the future as well
as an attempt to gauge how to correct current deficiencies.
Ratios are used by Bankers to evaluate the ability of the firm
to maintain certain levels of debt and interest.
Ratios are used by the owners...

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