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Exam 15: Financial Statement Analysis

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Question 21

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Condensed data taken from the ledger of Joplin Company at December 31, 2012 and 2011, are as follows: Prepare a comparative balance sheet, with horizontal analysis, for December 31, 2012 and 2011. (Round percents to one decimal point.)

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Question 22

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Why would you compare or not compare Coca-Cola and Pepsi-Cola (PepsiCo) as companies to each other?

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Coca-Cola has maintained its focus on th...

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Question 23

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Unusual items affecting the current period's income statement consist of changes in accounting principles and discontinued operations.

Based on the following data for the current year, what is the accounts receivable turnover?

A company reports the following: Determine the (a) rate earned on stockholders' equity, and (b) rate earned on common stockholders' equity. Round your answer to one decimal place.

An extraordinary item results from

If the accounts receivable turnover for the current year has decreased when compared with the ratio for the preceding year, there has been an acceleration in the collection of receivables.

The number of days' sales in inventory is one means of expressing the relationship between the cost of goods sold and inventory.

The following data are taken from the financial statements:

On a common-sized income statement, all items are stated as a percent of total assets or equities at year-end.

Vertical analysis refers to comparing the financial statements of a single company for several years.

The independent auditor's report does which of the following?

In a common-sized income statement, each item is expressed as a percentage of net income.

The following information pertains to Carlton Company. Assume that all balance sheet amounts represent both average and ending balance figures. Assume that all sales were on credit. What are the dividends per common share for this company?

Income statement information for Sharif Corporation is provided below: Required: Prepare a vertical analysis of the given income statement information for Sharif Corporation.

An increase in the accounts receivable turnover may be due to an improvement in the collection of receivables or to a change in the granting of credit and/or in collection practices.

A financial statement showing each item on the statement as a percentage of one key item on the statement is called common-sized financial statements.

A company reports the following: Determine the (a) accounts receivable turnover, and (b) number of days' sales in receivables. Round your answer to one decimal place.

A loss due to a discontinued operation should be reported in the income statement

A 15% change in sales will result in a 15% change in net income.