Question 56 Which of the following reasons is least likely a valid limitation of ratio analysis? A) Determining the target or comparison value for a ratio is difficult. B) Conclusions cannot be made from viewing one set of ratios. C) It is difficult to find comparable industry ratios. D) Calculation of ratios involves a large degree of subjectivity.
Question 57 Which of the following items are most appropriately used to assess the quality of a firm’s earnings and to correctly classify the repurchase by a firm of its own stock? More indicative of quality earnings Repurchase of stock A) Operating cash flow Investing cash flow B) Operating cash flow Financing cash flow C) Total cash flow Financing cash flow D) Total cash flow Investing cash flow
Question 58 For an organization with a simple capital structure, the computation of earnings per share is least likely to consider: A) the weighted average number of preferred shares outstanding. B) net income. C) preferred dividends. D) the weighted average number of common shares outstanding.
Question 59 A firm has both prepaid expenses and unearned revenue on its balance sheet. Which of the following pairs correctly classifies these two items? Prepaid expenses Unearned revenue A) Current asset Current asset B) Current liability Current asset C) Current liability Current liability D) Current asset Current liability
Question 60 An analyst determined the following information concerning Franklin, Inc.’s stamping machine: ♣ Acquired seven years ago for $22 million ♣ Straight line method used for depreciation ♣ Useful life estimated to be 12 years ♣ Salvage value originally estimated to be $4 million The stamping machine is expected to generate $1,500,000 per year for five more years and will then be sold for $1,000,000. The stamping machine is: A) impaired because its carrying value exceeds expected future cash flows. B) impaired because expected salvage value has declined. C) not impaired because annual expected revenue exceeds annual depreciation. D) not impaired because it continues to produce material revenue.
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发表于 2008-11-6 16:15
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