Test 1 Flashcards
this ratio is the product of return on sales x total asset turnover
return on assets
this is found by dividing 360 by accounts receivable turnover
average collection period (or days sales in receivables)
the outside entity would be most interested in the company’s debt ratios
banks (lenders)
a company with COGS of $400,000 and an average inventory of $20,000 would have this inventory turnover rate
$20,000
Found by adding average collection period to days in inventory
cash cycle
this is typically the single non-cash expense
depreciation
these are the types of expenses found below gross profit margin and before EBIT
operating expenses
preferred stock dividends are deducted just before the line item
earnings available to common stockholders
a company with 200,000 shares outstanding and an EATCS of $1,000,000 has this EPS
$5
The one constituent group (outside of the corp.) most interested in reading the income statement
shareholders
period of time represented by the balance sheet
1 day
determines the sequence in which the assets are listed
order of liquidity
commonly referred to as the accounting equation
assets = liabilities + shareholders’ equity
account that represents the total overall decline in a corporation’s fixed asset values
accumulated depreciation
difference between a corp’s total asset and total liabilities
book value
