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ABM > 2nd Mastery > Flashcards

2nd Mastery Flashcards

1
Q

Debt to Equity Ratio

[ A. Liquidity Ratio ]

[ B. Solvency Ratio ]

[ C. Profitability Ratio ]

A

B. Solvency Ratio

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2
Q

Inventory Turnover

[ A. Liquidity Ratio ]

[ B. Solvency Ratio ]

[ C. Profitability Ratio ]

A

A. Liquidity Ratio

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3
Q

Average Sales Period

[ A. Liquidity Ratio ]

[ B. Solvency Ratio ]

[ C. Profitability Ratio ]

A

A. Liquidity Ratio

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4
Q

Gross Profit Ratio

[ A. Liquidity Ratio ]

[ B. Solvency Ratio ]

[ C. Profitability Ratio ]

A

C. Profitability Ratio

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5
Q

Current Ratio

[ A. Liquidity Ratio ]

[ B. Solvency Ratio ]

[ C. Profitability Ratio ]

A

A. Liquidity Ratio

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6
Q

Times Interest Earned

[ A. Liquidity Ratio ]

[ B. Solvency Ratio ]

[ C. Profitability Ratio ]

A

B. Solvency Ratio

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7
Q

Quick Ratio

[ A. Liquidity Ratio ]

[ B. Solvency Ratio ]

[ C. Profitability Ratio ]

A

A. Liquidity Ratio

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8
Q

Equity Ratio

[ A. Liquidity Ratio ]

[ B. Solvency Ratio ]

[ C. Profitability Ratio ]

A

B. Solvency Ratio

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9
Q

Average Collection Period

[ A. Liquidity Ratio ]

[ B. Solvency Ratio ]

[ C. Profitability Ratio ]

A

A. Liquidity Ratio

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10
Q

Operating Profit Margin

[ A. Liquidity Ratio ]

[ B. Solvency Ratio ]

[ C. Profitability Ratio ]

A

C. Profitability Ratio

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11
Q

Working Capital

[ A. Liquidity Ratio ]

[ B. Solvency Ratio ]

[ C. Profitability Ratio ]

A

A. Liquidity Ratio

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12
Q

Return on Assets

[ A. Liquidity Ratio ]

[ B. Solvency Ratio ]

[ C. Profitability Ratio ]

A

C. Profitability Ratio

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13
Q

Receivable Turnover

[ A. Liquidity Ratio ]

[ B. Solvency Ratio ]

[ C. Profitability Ratio ]

A

A. Liquidity Ratio

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14
Q

Debt Ratio

[ A. Liquidity Ratio ]

[ B. Solvency Ratio ]

[ C. Profitability Ratio ]

A

B. Solvency Ratio

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15
Q

Net Profit Margin

[ A. Liquidity Ratio ]

[ B. Solvency Ratio ]

[ C. Profitability Ratio ]

A

C. Profitability Ratio

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16
Q

Which of the following is a measure of the company’s ability to pay its trade payables?

a. Current Ratio

b. Quick Ratio

c. Average Collection Period

d. Both a & b

e. Both b & c

A

d. Both a & b

17
Q

Which of the following is not a solvency ratio?

a. Debt Ratio

b. Equity Ratio

c. Debt to Equity Ratio

d. Times Interest Earned

e. None of the above

A

e. None of the above

18
Q

Socrates Co. reported average assets of P250,000, net income of P200,000, and net sales of P1,000,000 for 2017. What is the net profit margin for 2017?

a. 20%

b. 25%

c. 50%

d. 200% e. none of the above

19
Q

Which of the following is a liquidity ratio?

a. Average Sales Period

b. Average Total Assets

c. Average Inventory

d. Average Trade Receivable

e. None of the above

A

a. Average Sales Period

20
Q

Which is not a profitability ratio?

a. Gross Profit Margin

b. Operating Profit Margin

c. Net Profit Margin

d. Net Sales Margin

e. Return on Assets

A

d. Net Sales Margin

21
Q

Which ratio determines a company’s ability to pay interest from loan?

a. Debt ratio

b. Equity Ratio

c. Debt to Equity ratio

d. Times Interest Earned

e. None of the above.

A

d. Times Interest Earned

22
Q

In horizontal analysis, each account is expressed as a percentage of

a. total assets

b. total liabilities and owner’s equity

c. base year

d. none of the above

A

c. base year

23
Q

In vertical analysis, the base amount for bad debts expense is

a. accounts receivable

b. non-current assets

c. bad debts expense of past year

d. none of the above

A

d. none of the above

24
Q

Identify the type of analysis shown on the items below

                         Amount in Pesos        Percent Total Liabilities         300,000                     60%

Owner’s Equity 200,000 40%

Total Liabilities 500,000
and Owner’s Equity

a. horizontal analysis

b. ratio analysis

c. trend analysis

d. vertical analysis

A

d. Vertical Analysis

25
Talula Co. reported net sales of P150,000, P200,000 and P300,000 for 2015, 2016, and 2017, respectively. Assuming the base year to be 2015, what is the trend percentage for 2017? a. 100% b. 150% c. 133% d. 200%
d. 200%
26
Shows the relationship of each part to the whole in a single financial statement.
Vertical Analysis
27
Describes the significant relationship between the numbers presented in the financial statements.
Financial Ratio
28
Compares the same account in the financial statements to two periods (current and past) determining the amount of changes and computing its percentage change using a base year as comparison.
Horizontal Analysis
29
Analyzes not only two years in comparison but covers three, four or five years’ financial statements to determine the trends in the industry.
Trend Analysis
30
This can be expressed either as a rate, percentage, or a proportion
Financial Ratio
31
This is to determine the trends in the industry
Trend Analysis
32
In the statement of financial position, each item is expressed as a percentage of total assets.
Vertical Analysis
33
The amount under each year is divided by the amount in base year thereby determining the amount of the other years in relation to the base year
Trend Analysis
34
Helps management analyse increases and decreases in balance sheet and income statement accounts.
Horizontal Analysis
35
In the income statement, each item is presented as a percentage of net sales
Vertical Analysis

ABM (4 decks)

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