1. Net income is not used as a numerator or a denominator in which of the following financial ratios? (1 mark)   select one   a. Current ratio b. Times interest earned c Inventory turnover. d Gross profit ratio eAll of the above.

Present formulas and examples of the following financial ratios (Financial ratios)a. gross marginb. profit margin on salesc. return on equity (ROE)

choose: When a balance sheet amount is related to an income statement amount in comparing a ratio  a. The ratio losses its historical perspective because at the beginning of the year amount is combined with an end of the year amount.  b. The income statement amount should be converted to an average for the year.  c. Comparisons should be converted to market value  d. The balance sheet amount should be converted to an average for the year.

In order to create a common size statement for the Statement of Profit and Loss, all items must: a. Divided by net earnings b. None of the above c. Multiply by net earnings d. Multiply by sales e. Divided by sales

26. Given the following financial data for Alpha Company, calculate the ratios listed below the data. (Compute all ratios and percents to 2 decimal points.) Sales (all on credit) Cost of Goods Sold $650,000 422,500 Income before 78,000 Income Taxes Net Income 54,600 Ending Beginning Balances Balances Cash $19,500 $15,000 Accounts Receivable 65,000 59,800 (net) Merchandise 71,500 66,300 Inventory Plant and Equipment (net) 195,000 183,900 Total Assets $351,000 $325,000 Current $74,100 $100,200 Liabilities Long-Term Notes Payable 97,500 100,000 Stockholders' 179,400 124,800 Equity Total Liabilities and Stockholders' $351,000 $325,000 Equity

When performing a horizontal analysis on an income statement, the percentage change inany individual item is calculated by dividing the dollar amount of the change from the baseperiod to the current period bya. the base period amount.b. the current period amount.c. the amount estimated for the future period.d. the average of the base and the current period amounts.

When using vertical analysis, we express income statement accounts as a percentage of a. Net income. b. Sales. c. Gross profit. d. Total assets.

For each ratio listed, identify whether the change in ratio value from the prior year to the current year is usually regarded as favorable or unfavorable.

Profitability ratios include all of the following EXCEPT a.current ratio. b.asset turnover. c.return on total assets. d.price-earnings ratio.

The primary focus of horizontal analysis isa. the income statement only.b. the balance sheet only.c. the percentage changes in line items on the comparative financial statements.d. the individual line items on the financial statements as a percentage of a related base,such as total sales or total assets.