Financial reporting and Discloures

Question 1

Segment Reporting

Answer 1

To be significant enough to report on, a segment must be at least 10 of:
1. combined revenues (whether inter segment or affiliated customers)
2. Operating profit (of all segments not having an operating loss)
3. Identifiable assets

Question 2

Current Ratio

Answer 2

Current assets/ current liabilities

Question 3

Quick Ratios

Answer 3

Cash and cash equivalents + short term marketable securities + receivable / current liabilities

Question 4

Accounts receivable turnover

Answer 4

Sales (net) / average accounts receivable (net)

Question 5

Days sale in accounts receivable

Answer 5

Ending accounts receivable (net) / (sales (net) /365)

Question 6

Inventory Turnover

Answer 6

Cost of good sold/ average inventory

Question 7

Days in inventory

Answer 7

Ending inventory / (cost of good sold/365)

Question 8

Accounts payable turnover

Answer 8

Cost of good sold/ average accounts payable

Question 9

Days of payable outstanding

Answer 9

Ending accounts payable /(cost of good sold/365)

Question 10

Cash conversion cycle

Answer 10

Days sales in AR+ days in inventory- days of payable outstanding

Question 11

Asset turnover

Answer 11

Sales (net) / average total assets

Question 12

Fair Value Hierarchy - Level 1

Answer 12

Level 1 inputs are quoted prices in active markets for identical assets or liabilities that the reporting entity has access to on the measurement date.

Question 13

Fair Value Hierarchy - Level 2

Answer 13

Quotes prices for similar assets or liabilities in active markets

Question 14

Fair Value Hierarchy - Level 3

Answer 14

Are unobservable inputs for the asset or liability

Question 15

Working capital

Answer 15

Total current assets - total current liabilities

Question 16

Working capital turnover

Answer 16

Sales/ average working capital