Gross profit is a measure of the overall profitability of a company. True False

Q: Briefly describe the ratios that can be used to evaluate a company’s profitability.

A:

Q: Do you agree with the view that a company which reports substantial profits within its statement of…

A: Profit is the income which is earned after deducting all the expenses from the revenues of a period.…

Q: what is means activity ratio, liquidity ratio, and Profitability Ratio for a company?

A: An activity ratio is a financial indicator that shows how effectively a firm is generating revenue…

Q: what determines the market value of a company are not profits, per se, but rather, cash flows?

A: Market value of a company : In simple words, the market value of a company refers to the value of a…

Q: why most of the companies used gross profit method?

A: Gross method is used to evaluate the inventory at year end.

Q: All of the following are the factors affecting the gross profit except O cash flow O volume O…

A: Gross Profit = Sales revenue - Cost of goods sold

Q: Which of the following financial ratios is not a measure of operating profitablitlity? Return on…

A: Formula: Return on Assets = Net income / Total Assets.

Q: Which of the following income statement figures would probably be the best indicator of a company's…

A: Income statement: The income statement is one of the three primary financial statements used to…

Q: Common measures of a company's profitability include   price-earnings ratio   earnings per share…

A: The profitability ratios are used to measure the business's ability for generating profit from its…

Q: A company can use comparisons of its financial data to the data of other companies and industry…

A: In order to evaluate the companies position, a company can take various measures

Q: How can Turnover Ratios be used to judge a company's performance?

A: Ratio is a financial measure which is used to measure the company’s growth and performance by…

Q: For each of the following cases, state whether the statement is true for LIFO or for FIFO. Assume…

A: when inventory costs are rising, LIFO uses most recent purchases, which increases cost of good sold,…

Q: Financial analysis considers the profitability, liabilities and other financial capacities of a…

A: Financial analysis of a company certainly looks into the profitability, debt levels and other key…

Q: Which of the following is an item found on a company's balance sheet? a. Net Income b. Owners'…

A: SOLUTION- OWNERS EQUITY- IT IS THE AMOUNT THAT BELONGS TO THE OWNERS OF THE BUSINESS AS SHOWN ON THE…

Q: Analyze the company’s profitability and its ability to generate sufficient operating profit by using…

A: Ratio Analysis The purpose of preparing the ratio analysis to know the strength and weakness of the…

Q: What are the limitations to using financial ratio analysis [such as profitability ratios, liquidity…

A: “Since you have asked multiple questions, we will solve the first question for you. If you want any…

Q: If the revenues are correctly reported and the gross profit of a company is understated, what is the…

A: There would be effect on the retained earnings on stockholders' equity if the gross profit is not…

Q: Explain “ACCRUAL BASIS” and “CASH BASIS” briefly with your own word by giving specific examples. If…

A: The accrual basis of accounting represents that the revenue and expenses would be recorded when it…

Q: Explain how a company can be “profit rich, yet cash poor.”

A: Corporation: A corporation is a form of business entity that is incorporated through the state…

Q: T F If a firm’s sales revenues exceed its expenses,the firm has earned a profit

A: The net income is the net profit of the company earned during the period. The net income includes…

Q: Why do you think companies use revenue recognition as a primary means for inflating profits?

A: Revenue Recognition: Revenue recognition is the recording of revenues in the books of the company…

Q: Gross Profit Ratio for a firm remains same but the Net Profit Ratio is decreasing. The reason for…

A: Gross profit is given by sales revenue minus cost of goods sold. Gross profit =Sales revenue- cost…

Q: Which of the following statements is likely to be true, for a company making profits? Select one:…

A: All the transactions of the company that are happened during the year will be recorded first in the…

Q: Which is wrong about the use of financial statement analysis? a. Seasonality factors may contribute…

A: Financial statements are the reports of an organization, prepared at the end of a financial period.…

Q: The business risk of a company is most accurately measured by the company's: a. Debt-to-equity…

A: Bussiness risk consists uncertainty of sales and profits and other production related uncertainty.

Q: What does the current ratio inform you about a company?   A. The efficient use of assets.   B. The…

A: Current Ratio : The current ratio is the relation between the current assets and current liabilities…

Q: ratio

A: Ratio analysis is a technique of financial statements analysis. It is the most widely used tool to…

Q: when a client notices a discrepancy between annual profits calculated by the accountant versus your…

A: 1. Accountant’s Cash-based Profit: The accounting method in which the revenue is the amount of cash…

Q: “A company can be profit rich but cash poor” critically evaluate this statement focusing on the…

A: Profit may not always been in the form of cash for a company. A company may have recognized revenue…

Q: Describe and justify why you would use the following ratios as an analyst to evaluate the…

A: The ratio of various profits (such as gross profit, net profit, operating profit) to Net sales are…

Q: Compute the total profit or loss for the company.

A: Total profit for the company is the profit which has been added together from all the separate…

Q: tability Ratios from a company's financial statement, and how such profitability ratios are…

A:

Q: Which of the following terms does not mean the same as the others? a. Bottom line b. Profit from…

A: Profit from operations is the profit derived from day to day operations of the entity. That is the…

Q: The comparison of a company's financial condition and performance to a base amount is known as:…

A: Comparison of financial items to a base amount. For example in the income statement, base amount can…

Q: Which of the following ratios would NOT be considered to be a measure of a business economic…

A: The economic performance of a business can be measured by its ability to generate profits.…

Q: What does the firm need to do to raise its ROE? Calculate the profit margin ratio of the company and…

A: A financial ratio is the ratio of various numbers in the balance sheet or balance sheet and income…

Q: What is the calculation for 'Profit Margin' for the firm in that picture?

A: Information Provided: 2015 net profit = 39,878 2015 Revenue = 100,000   2016 net profit = 11,527…

Q: On an income statement, can a company report total revenues instead of net sales? Are these the same…

A: Income statement:It is the financial statement which is prepared by the company which shows the…

Q: The profitability and financial position of a firm can be judged to be improving, or det competitors…

A: In business there is need of comparing with other similar companies so that better valuation can be…

Q: In regards to​ benchmarking, which of the following statements is​ incorrect? A. Benchmarking is…

A: Benchmarking refers to the process of measuring firm's processes and performance measures to that…