Financial Accounting
9th Edition
ISBN: 9781259738692
Author: Libby
Publisher: MCG
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Chapter 13, Problem 13.10ME
To determine
Analyse the impact of Accounting changes on Ratios of Corporation Y.
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Students have asked these similar questions
What does the inventory turnover period ratio measure?
Select one:
a.Profitability.
b.The average time an organisation holds inventory.
c.The liquidity of the firm.
d.How much the firm's current assets could decrease and still leave it able to pay its current liabilities.
The higher the anticipated return on net operating assets (RNOA) relative to the anticipated growth in net operating assets, the higher will be the unlevered price-to-book ratio. Is this correct?
Kindly answer the question with introduction and conclusion based on the concept of the question. Explain the answer properly considering the accounting aspect of it.
The management of Mastronardo Company is considering the effects of inventory-costing methods on its financial statements.Assuming that the price the company pays for inventory is increasing, which method will:
a.
Provide the highest gross profit?
select a method FIFOLIFOAverage-cost
b.
Provide the highest ending inventory?
select a method FIFOLIFOAverage-cost
Chapter 13 Solutions
Financial Accounting
Ch. 13 - Who are the primary users of financial statements?Ch. 13 - When considering an investment in stock, investors...Ch. 13 - How does product differentiation differ from cost...Ch. 13 - What are the two general methods for making...Ch. 13 - What are component percentages? Why are they...Ch. 13 - What is ratio analysis? Why is it useful?Ch. 13 - What do profitability ratios focus on? What is an...Ch. 13 - What do turnover ratios focus on? What is an...Ch. 13 - What do liquidity ratios focus on? What is an...Ch. 13 - What do solvency ratios focus on? What is an...
Ch. 13 - What do market ratios focus on? What is an example...Ch. 13 - Prob. 12QCh. 13 - Explain why rapid growth in total sales might not...Ch. 13 - A company has total assets of 500,000 and...Ch. 13 - Prob. 2MCQCh. 13 - Prob. 3MCQCh. 13 - Prob. 4MCQCh. 13 - Prob. 5MCQCh. 13 - Prob. 6MCQCh. 13 - Prob. 7MCQCh. 13 - Prob. 8MCQCh. 13 - Prob. 9MCQCh. 13 - Prob. 10MCQCh. 13 - Prob. 13.1MECh. 13 - Prob. 13.2MECh. 13 - Prob. 13.3MECh. 13 - Computing the Financial Leverage Percentage...Ch. 13 - Analyzing the Inventory Turnover Ratio A...Ch. 13 - Prob. 13.6MECh. 13 - Prob. 13.7MECh. 13 - Prob. 13.8MECh. 13 - Prob. 13.9MECh. 13 - Prob. 13.10MECh. 13 - Using Financial Information to Identify Companies...Ch. 13 - Prob. 13.2ECh. 13 - Prob. 13.3ECh. 13 - Prob. 13.4ECh. 13 - Prob. 13.5ECh. 13 - Prob. 13.6ECh. 13 - Prob. 13.7ECh. 13 - Prob. 13.8ECh. 13 - Prob. 13.9ECh. 13 - Prob. 13.10ECh. 13 - Inferring Financial Information from Ratios E13-11...Ch. 13 - Prob. 13.12ECh. 13 - Prob. 13.13ECh. 13 - Prob. 13.1PCh. 13 - Prob. 13.2PCh. 13 - Prob. 13.3PCh. 13 - Prob. 13.4PCh. 13 - Prob. 13.5PCh. 13 - Computing Comparative Financial Statements and...Ch. 13 - Analyzing Financial Statements Using Ratios Use...Ch. 13 - Prob. 13.8PCh. 13 - Prob. 13.9PCh. 13 - Prob. 13.1APCh. 13 - Prob. 13.2APCh. 13 - Calculating Profitability, Turnover, Liquidity,...Ch. 13 - Prob. 13.4APCh. 13 - Prob. 13.5APCh. 13 - Prob. 13.6APCh. 13 - Prob. 13.1CPCh. 13 - Prob. 13.2CPCh. 13 - Comparing Companies within an Industry Refer to...Ch. 13 - Prob. 13.4CPCh. 13 - Inferring Information from the DuPont Model Ratios...Ch. 13 - Prob. 13.6CP
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- Which ratio can provide an indication of the salability of the company's products? Question 20 options: A) Current ratio B) Account receivable turnover C) Gross profit margin D) Inventory turnoverarrow_forwardCompared to using the weighted average cost method to account for inventory, during aperiod in which prices are generally rising, the current ratio of a company using the FIFOmethod would most likely be:A. lower.B. higher.C. dependent upon the interaction with accounts payable.arrow_forwardUsing this data, calculate the following ratios: return on sales, inventory turnover, inventory-on-hand period, and current ratio.arrow_forward
- Given the profit loss (income statement) and balance sheet for Sam’sSandwich Delivery (Table 4–8), answer the following:a. Calculate the current and quick ratios.b. Using the inventory figure on the balance sheet as average inventory, calculatethe inventory turnover ratio.c. Calculate the debt-to-equity ratio, debt-to-total-asset ratio, and operatingprofit margin ratio.d. Perform a vertical analysis of the income statement.e. Perform a vertical analysis of the balance sheet.f. Based on your analysis, would you consider investing in Sam’s SandwichDelivery?arrow_forwardRequired: (a) You are required to calculate the following ratios:(i) Gross profit margin(ii) Operating profit margin(iii) Expenses to sales(iv) Return on Capital Employed(v) Asset turnover(vi) Non-current asset turnover(vii) Current Ratio(viii) Quick Ratio(ix) Inventory days(x) Receivables days(xi) Payable days(xii) Interest cover (b) In light of your calculations comment on the performance of the company over thelast two years.arrow_forwardWhat insights can be gained from inventory ratio analysis, such as inventory turnover ratio and number of days sales in inventory ratio?arrow_forward
- MULTIPLE CHOICE. Answer the following: 1.It show how efficient the business is as to its purchase or use of inventory for the whole operation. a. Operating Income b. Inventory Liquidation Ratio c. Inventory Turnover d. Operating Efficiency 2. This shows that the original investment made by the owner will be recovered. a. Payback Period b. Return on Investment c. Asset Test Ratio d. Capital Turnover Ratio 3. If the company wants to see the ratio of income generation of the business, what formula will they use for its computation? a. Total Projected Cost / Average Annual Cash Inflow b. (Net Income/Cost of Investment) x 100 c. (Net Profit/Net Sales) X 100 d. Cost of Goods Sold/ Average Inventory 4. If the cost of goods sold year 2023 is P60,000, net sales is P60,000 and average inventory is 20,000, what is the inventory turn-over? a. 6 times b. 3 times c.2 times d. 2.5 timesarrow_forwardInventory Turnover Ratio shows the speed at which the inventory will be converted into sales. Select one: True Falsearrow_forwardAssuming rising inventory prices, which statement is correct? Group of answer choices A. FIFO reports a lower value for cost of sales than other methods B. FIFO reports a lower value for closing inventory than other methods C. Using FIFO, it is not possible to calculate whether cost of sales/inventory is lower or higher than it would be if other assumptions about inventory valuation were made D. FIFO reports a lower profit than other methodsarrow_forward
- A bank that is examining the ratio of annual costs of goods sold to average inventory, is examining which category of ratios? a.Profit measures b.Operating efficiency measures c.Liquidity measures d.Expense control measuresarrow_forwardFAST PLZ - Which of the following element of cost is important in calculating the cost of closing inventory? a. Market price of Opening stock. b. Cost price of goods sold c. Market price of good sold d. Sales price of goods soldarrow_forwardWhich of these is not a liquidity ratio? Choose Current ratio Asset turnover ratio Inventory turnover ratio Receivables turnover ratio Which of the following usually is least important as a measure of short-termarrow_forward
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INVENTORY & COST OF GOODS SOLD; Author: Accounting Stuff;https://www.youtube.com/watch?v=OB6RDzqvNbk;License: Standard Youtube License