Data Analytics For Accounting
19th Edition
ISBN: 9781260375190
Author: RICHARDSON, Vernon J., Teeter, Ryan, Terrell, Katie
Publisher: Mcgraw-hill Education,
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Textbook Question
Chapter 8, Problem 8MCQ
What type of ratios measure a firm’s operating efficiency?
- a. DuPont ratios
- b. Liquidity ratios
- c. Activity ratios
- d. Solvency ratios
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The ratio group most likely to be used to indicate a firm's ability to meet short-term financial obligations would be ____.
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financial leverage ratios
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profitability ratios
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liquidity ratios
A ratio that measures a company’s profitability is thea. leverage ratio.b. gross margin percentage.c. current ratio.d. times-interest-earned ratio.
Which of the following ratios is used to measure the profit earned on each dollar invested in a firm?a. return on sales ratio c. current ratiob. return on equity d. asset turnover ratio
Chapter 8 Solutions
Data Analytics For Accounting
Ch. 8 - Prob. 1MCQCh. 8 - XBRL stands for: a. Extensible Business Reporting...Ch. 8 - Prob. 3MCQCh. 8 - Prob. 4MCQCh. 8 - Prob. 5MCQCh. 8 - Prob. 6MCQCh. 8 - Prob. 7MCQCh. 8 - What type of ratios measure a firms operating...Ch. 8 - What type of ratios measure a firms ability to pay...Ch. 8 - Prob. 10MCQ
Ch. 8 - Prob. 1DQCh. 8 - Prob. 2DQCh. 8 - Why do audit firms perform analytical procedures...Ch. 8 - Go to https://xbrl.us/data-rule/dqc_0015-lepr/ and...Ch. 8 - Go to https://xbrl.us/data-rule/dqc_0015-lepr/ and...Ch. 8 - Prob. 6DQCh. 8 - Prob. 7DQCh. 8 - Prob. 8DQCh. 8 - Prob. 1PCh. 8 - Prob. 2PCh. 8 - Prob. 3PCh. 8 - Prob. 4PCh. 8 - Go to Loughran and McDonalds sentiment word lists...Ch. 8 - Prob. 6P
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- Which of the following ratios is used to measure a firms profitability? a. Liabilities Ă· Equity c. Sales Ă· Assets b. Assets Ă· Equity d. Net Income Ă· Net Salesarrow_forwardwhat are liquidity ratios, leverage ratios, profitability ratios, and market measure ratios?arrow_forwardWhich financial ratios would you recommend to evaluate a company's solvency? Once these ratios are computed, what do you recommend comparing them to?arrow_forward
- Which measures the liquidity ratio of firms? a. Earnings per share b. Net profit margin Oc. Return on Assets C. d. Average collection periodarrow_forwardwhat is means activity ratio, liquidity ratio, and Profitability Ratio for a company?arrow_forwardGive examples of Gearing Ratios from a company's financial statement, and how such gearing ratios are computed, and interpreted. As many gearing ratios as possible.arrow_forward
- In a DuPont analysis, what are the components of return on assets?a. Net Profit Margin Ratio and Debt Ratiob. Net Profit Margin Ratio and Leverage Ratioc. Net Profit Margin Ratio and Asset Turnover Ratiod. Asset Turnover Ratio and Leverage Ratioarrow_forwardWhich group of financial statement ratios best captures what investors think of a company’s past performance and future prospects? a. Cash flow ratios b. Liquidity ratios c. Asset management ratios d. Market value ratios e. Profitability ratiosarrow_forwardDescribe and justify why you would use the following ratios as an analyst to evaluate the performance of a company. Profitability Ratios Liquidity Ratios Gearing Ratios Investment Ratiosarrow_forward
- Exparrow_forwardFinancial Ratios are grouped into five main categories: Liquidity ratios, Leverage ratios, Efficiency ratios, Profitability ratios and Market value ratios. Explanation and Examplesarrow_forwardDefine each of the following terms: a. Liquid asset b. Liquidity ratios: current ratio; quick ratio c. Asset management ratios: inventory turnover ratio d. Debt management ratios: total debt to total capital; times-interest-earned (TIE) ratio e. Profitability ratios: profit margin; return on total assets (ROA); return on common equity (ROE); return on invested capital (ROIC); basic earning power (BEP) ratio f. Market value ratios: price/earnings (P/E) ratio; market/book (M/B) ratio; enterprise value/EBITDA ratioarrow_forward
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