FIN. ACCT.-TOOLS FOR BUS.DEC.MAKING-CODE
9th Edition
ISBN: 9781119595724
Author: Kimmel
Publisher: WILEY C
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Students have asked these similar questions
Which of the following financial statements would be most useful if an analyst wants to know the profitability of a company?
A.
balance sheet
B.
statement of cash flows
C.
statement of retained earnings
D.
income statement
What are financial ratios?
Using numerical values from financial statements, financial ratios are created to obtain useful information about a company. Using the numbers on a company's balance sheet, income statement, and cash flow statement, quantitative analysis of a company's liquidity, leverage, growth, margins, profitability, rates of return, valuation, and other factors can be performed. Financial analysis ratio is used for 2 main purpose; to track the company’s performance and to make comparative judgements of the company performance. Users from outside: Retail investors, financial analysts, creditors, rivals, tax and regulatory authorities, and industry observers are internal users. Owners, employees, and the management team.
1.) Solve the Income Statement of AAA Company using Horizontal Analysis.
2.) As a Financial Analyst how would you interpret the data?
Knowledge Booster
Similar questions
- Please discuss the questions followings: 1. What is the difference between liquidity and solvency? 2. What is the difference between working capital and the current ratio? 3. Why is the accrual basis of accounting requied by geneally accepted acccounting principles (GAAP)? 4. What is the most important output of the accounting cycle? Do all companies have an accounting cycle?arrow_forwardHow would current and quick liquidity ratios be used by management to run the business, investors for valuation purposes, and bankers for lending purposes? How do I determine if my quick ratio is important or not.arrow_forward(Please answer in Excel and show how you got the answer so I can better understand. Thank you.) 1. Given the financial statements (Balance Sheet, Income Statement) for a publicly traded company. Calculate the profitability ratio to find the gross profit ratio and the Net profit ratio.arrow_forward
- What is the role of the Finance Manager of a company? What is their biggest value to a company? How to Financial managers use Balance Sheet information? How would the finance manager use financial ratios in their job?arrow_forwardPlease briefly describe an income statement, statement of cash flows, and balance sheet. Please describe a hypothetical pro forma income statement. Please describe the five types of financial ratio analyses. Please provide and briefly discuss 1 ratio from each of the five types of analysis. Apply these same ratios to the financial statements of a firm of your choice, except those that we formerly addressed in any way in the course.arrow_forwardDuckies, Etc. is a bath toy manufacturer reviewing their current Balance Sheet. 1. What are the total current assets? 2. What are the total long term assets? 3. What are total assets? 4. What is the balance for Accounts Payable? 5. What is the balance for Total Liabilities? 6. What is the balance for Total Liabilities and Shareholder Equity? 7. What is the balance for Capital Surplus?arrow_forward
- Studypug.com Which of the following statements is not true of horizontal analysis? a.Each item on a financial statement is compared with a total amount from the same statement. b.It can be useful in analyzing trends. c.Each item on a current financial statement is compared to the same item on an earlier statement. d.It can be useful in interpreting the financial performance of a company.arrow_forwardHow you can assess the company’s performance with financial ratios? Select any company and analyzes the current situation of financial statements with the help of rations.arrow_forwardFor measuring the financial risk in the organization, we can use? Select one: a. Cash flows Ratio b. Balance sheet ratios c. Earnings of the company d. All options providedarrow_forward
- From curiosity, what graphs are made to indicate the financial performance of a company?arrow_forwardPlease explain why solvency ratios, such as, debt, debt/equity, and time interest earned ratios are important to businesses. Please explain what information is provided by each ratio.arrow_forwardPotential stockholders and lenders are interested in a company's financial statements. Several financial statement items appear below. Use this information to answer the questions that follow. Accounts receivable Current liabilities Income taxes Cash Common stock Retained earnings Office supplies Inventory of the listed above, which four are current assets? Select one: O a. Accounts receivable, net income, inventory, and dividends O b. Cash, accounts receivable, inventory, and office supplies O c. Cash, accounts receivable, common stock, and sales O d. Net income, cash, office supplies, and inventory Bonds payable Dividends Net income Salesarrow_forward
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