Professional Documents
Culture Documents
6.
If the interest rate on debt is higher than ROA, then a firm will __________ by
increasing the use of debt in the capital structure.
A.
B.
C.
D.
5.
4.
3.
determine
financial
Which of the following ratios gives information on the amount of profits reinvested in
the firm over the years?
A.
B.
C.
D.
Sales/total assets
Debt/total assets
Debt/equity
Retained earnings/total assets
2011
RM
50,000
950,000
1,500,000
2,500,000
3,000,000
RM 5,500,000
Account payable
Bank loan
Total current liabilities
Bonds payable
Total liabilities
Common shares (130,000 units)
Retained Earnings
Total liabilities and equity
720,000
100,000
820,000
1,000,000
1,820,000
300,000
3,380,000
RM 5,500,000
7.
8.
2.31
1.87
2.22
2.46
9.
800,000
600,000
1,400,000
900,000
2,300,000
300,000
3,840,000
RM 6,440,000
3.00
0.33
2.8
0.36
153.33%
353.85%
12.8%
29.54%
10. Company directors are required to include in the annual report the companys and its
subsidiaries financial statements as mandatorily required in the:
A.
B.
C.
D.
11. The opinion given on the sufficiency of financial records kept by the company in accordance
to the stated act and compliance with the approved accounting standards can be found in
which of the following report?
A.
B.
C.
D.
Directors Report
Audit Committees Report
Chairmans Statement
Auditors Report
13. A general rule to use in assessing the average collection period is that:
A.
B.
C.
D.
14. If a company has acid-test ratio (quick ratio) of 1.2:1, what respective effects will the
borrowing of cash by short-term debt and collections of accounts receivable have on
the ratio?
A.
B.
C.
D.
Short-term borrowing
Collection of receivables
Increase
Increase
Decrease
Decrease
No effect
Increase
No effect
Decrease
15. Net sales are RM6,000, beginning total assets are RM2,800, and the asset turnover
ratio (ratio of net sales to assets) is 3.0 times. What is the ending total asset balance?
A.
B.
C.
D.
RM2,000
RM1,200
RM2,800
RM1,600
16. Man Pharmacy had net credit sales of RM16,000 and cost of goods sold of RM12,000
for
the year. The average inventory for the year amounted to RM2,000. What is the average
number of days to sell the inventory during the year?
A.
B.
C.
D.
91 days
61 days
46 days
26 days
RM1,200,000
RM960,000
RM840,000
RM600,000
If 2007 is the base year, what is the percentage increase in sales from 2007 to 2009?
A.
B.
C.
D.
100%
160%
70%
62.5%
18. The major device for measuring the profitability of a firm over a defined period of
time is the
A.
B.
C.
D.
income statement.
balance sheet.
statement of cash flow.
none of the above.
19. The major device that indicates what the firm owns and how these assets are financed
in the form of liabilities or ownership interest:
A.
B.
C.
D.
The higher the current ratio, the more likely a firm is able to pay its short-term
obligations.
The lower the quick ratios relative to the current ratio, the safer a firm is in
terms of liquidity.
The ratio of net working capital to total assets always lies between 0 and 1.
Relatively high current ratios are usually a sign of efficient working capital
management.
21. An analyst can judge a company's level of debt by comparing these ratios:
A.
B.
C.
D.
2010
RM380,000
1,680,000
2009
Amount
RM500,000 RM120,000
1,500,000
180,000
Percent
24%
12%
vertical analysis
horizontal analysis
liquidity analysis
Quick ratio
Income statement
Chairman statement
25. An annual report contains a great many statements and reports. Which one of the
following statements/reports is not covered either by statute or by accounting
standards?
Periodic summary
Auditors' report
Directors' report
27. Under current accounting principles, net income on the income statement is measured
as the
A
28. Which of the following items will typically be found in a corporate annual report?
A
Company budgets
Management's declaration that the auditors are responsible for the financial
statements
29. Assume that you want to determine the amount of gross profit for a company. Which
of the following financial statements is the BEST source of this information?
Income Statement
30. Zino Corp. reported the following items on its balance sheet:
1.61 to 1
0.52 to 1
1.91 to 1
2 to 1
TUTORIAL # 5
GROUP: _____
______________________________________
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