Performance Analysis of Public Companies
T/F - Any legal action against a company is taken against the owners of the company.
What is False
Companies are a separate legal entity
T/F Horizontal analysis involves taking a key line item in one of the financial statements, choosing a base year, and calculating how much the item has increased or decreased each year from the base.
What is TRUE?
Which of the following ratios is not an indicator of liquidity?
i inventory turnover
ii times interest earned
iii quick ratio
iv turnover of accounts receivable.
What is times interest earned ratio?
T/F ‘Limited’ generally indicates that the liability of the shareholders to the company is limited to the agreed purchase price of their shares.
What is TRUE
T/F Vertical analysis gives an indication of performance over many years.
What is False?
Which of the following ratios is an indicator of the profitability of the business?
i current ratio
ii price earnings ratio
iii rate of return on assets
iv debt ratio.
What is rate of return on assets ?
T/F Retained earnings represent part of the shareholders’ equity.
What is TRUE?
Which Statement does company income tax appear on?
What is Statement of Profit or Loss
Solve this anogram?
RBDAETTIO
It is an indicator of the gearing of a company
What is debt ratio?
T/F Retained earnings in a company represent past profits and so are represented in cash.
What is FALSE?
Which Statement does Property Plant and Equipment appear on?
What is Statement of Finanical Position?
Solve this anogram:
NNGSPSHAARRREEEI
The ratio that measures the profit earned on each ordinary share.
What is earnings per share ratio?
T/F - Dividends paid represent a cash outflow from financing activities.
What is TRUE
T/F In relation to the Statement of Cash Flows, income tax is an operating outflow?
SOlve this anogram:
AEIRTCVL
A method of analysing financial statements that expresses each item in the financial statement as a percentage of a base amount.
What is vertical analysis