Question 1

Betta, Inc. reported $23,800 in A/R in 2016 and $25,200 in A/R in 2015. The percentage change in A/R from 2015 to 2016 was: (Round your final answer to two decimal places, X.XX%.)
A)+5.56%.
B)+5.88%.
C) -5.56%.
D) -5.88%.

Accepted Answer

The answer of Betta, Inc. reported $23,800 in A/R in...

Question 2

Illusions, Inc. has current assets of $52,000, long-term assets of $262,700, current liabilities of $42,600, and long-term debt of $154,700. Illusions' debt ratio is: (Round your final answer to two decimal places, X.XX%.)
A)75.1%.
B)49.16%.
C)62.69%.
D)58.89%.

Accepted Answer

The formula for debt ratio is:

Debt Ratio = Total Debt / Total Assets

Total assets can be calculated by adding current assets and long-term assets:

Total Assets = Current Assets + Long-term Assets = $52,000 + $262,700 = $314,700

Total debt can be calculated by adding current liabilities and long-term debt:

Total Debt = Current Liabilities + Long-term Debt = $42,600 + $154,700 = $197,300

Plugging these values into the debt ratio formula:

Debt Ratio = Total Debt / Total Assets = $197,300 / $314,700 = 0.6269

Converting to a percentage and rounding to two decimal places:

Debt Ratio = 62.69%

Therefore, the best choice is C.

Question 3

Danio's Diagnostics had a loss from discontinued operations of $130,000. If their corporate tax rate is 40%, at what amount will the loss be shown on the Income Statement?
A)$130,000
B)$78,000
C)$52,000
D)Not enough information is given to answer the question.

Accepted Answer

The loss from discontinued operations of $130,000 will be multiplied by the corporate tax rate of 40%, resulting in a tax benefit of $52,000. Therefore, the loss will only be shown on the Income Statement at a net amount of $78,000 ($130,000 - $52,000).

Question 4

Crowne Cottages, Inc. has current assets of $44,000, long-term assets of $250,900, current liabilities of $42,600, and long-term debt of $156,700. Crowne's debt ratio is: (Round your final answer to two decimal places, X.XX%.)
A)62.46%.
B)67.58%.
C)53.14%.
D)79.43%.

Accepted Answer

Debt ratio is calculated as total debt divided by total assets.

Total debt = Current liabilities + Long-term debt = $42,600 + $156,700 = $199,300
Total assets = Current assets + Long-term assets = $44,000 + $250,900 = $294,900

Debt ratio = Total debt / Total assets = $199,300 / $294,900 = 0.6758 = 67.58% (rounded to two decimal places)

Therefore, the correct choice is B.

Question 5

If cash is $4,170 in 2016 and $3,370 in 2015, what is the percent increase or decrease from 2015 to 2016? (Round your final answer to two decimal places, X.XX%.)
A)+0.81%.
B)+23.74%.
C)-1.24%.
D)+19.18%.

Accepted Answer

The cash increased from $3,370 in 2015 to $4,170 in 2016. The increase is $4,170 - $3,370 = $800. The percent increase is ($800 / $3,370) * 100 = 23.74%.

Question 6

Which analysis deals with the percentage of changes in certain items over a period of years?
A)Horizontal analysis
B)Vertical analysis
C)Incremental analysis
D)Trend analysis

Accepted Answer

Trend analysis deals with the percentage of changes in certain items over a period of years by examining patterns or trends in financial data over time.

Question 7

The revenue of Lionworks, Inc. for the years 2014, 2015, and 2016 are $79,000, $96,000 and $197,000, respectively. If 2014 is the base year, the trend percentage for 2015 is: (Round your final answer to two decimal places, X.XX%.)
A)21.52%.
B)100.00%.
C)121.52%.
D)(59.90%).

Accepted Answer

To calculate the trend percentage for 2015, we need to use the following formula:

Trend percentage = (Revenue for the current year / Revenue for the base year) x 100

Using the revenue figures given, we get:

Trend percentage for 2015 = (96000 / 79000) x 100 = 121.52%

Therefore, the answer is C, 121.52%.

Question 8

TNT Guitar's sales were $13,100 in 2016 and $11,600 in 2015. The percentage change in TNT's sales from 2015 to 2016 was: (Round your final answer to two decimal places, X.XX%.)
A)+11.45%.
B) -12.93%.
C)+12.93%.
D)-11.45%.

Accepted Answer

The percentage change in sales from 2015 to 2016 is calculated as: $\frac{(13100 - 11600)}{11600} \times 100 = \frac{1500}{11600} \times 100 = 12.93\%$. This is a positive change, indicating an increase in sales.

Question 9

A comparison of the amounts for the same item in the financial statements of two or more periods is called:
A)vertical analysis.
B)comparative analysis.
C)horizontal analysis.
D)trend analysis.

Accepted Answer

Horizontal analysis compares the amounts for the same item in the financial statements of two or more periods. Vertical analysis compares the percentage of each item in relation to a base (such as total assets or sales). Comparative analysis can refer to either horizontal or vertical analysis. Trend analysis examines changes in data over time to identify patterns or trends.

Question 10

If current assets were $101,000 in 2015 and $91,000 in 2016, what was the amount of increase or decrease in percentage terms from 2015 to 2016? (Round your final answer to two decimal places, X.XX%.)
A)Increase of 11%
B)Decrease of 11%
C)Increase of 10%
D)Decrease of 10%

Accepted Answer

To calculate the percentage change, we use the following formula:

Percentage Change = ((New Value - Old Value) / Old Value) × 100

Substituting the given values:

Percentage Change = (($91,000 - $101,000) / $101,000) × 100 
Percentage Change = (-$10,000 / $101,000) × 100 
Percentage Change = -9.9%

Since the percentage change is negative, it means that there is a decrease in current assets from 2015 to 2016. Rounded to two decimal places, the percentage decrease is 10.00% which corresponds to Choice D.

Question 11

Net income was $48,000 in 2015 and $60,000 in 2016. The percentage increase or decrease in net income from 2015 to 2016 was: (Round your final answer to two decimal places, X.XX%.)
A)+25.00%.
B)+125.00%.
C)-20.00%.
D)-25.00%.

Accepted Answer

The increase in net income from 2015 to 2016 is calculated as ($60,000 - $48,000) / $48,000 = $12,000 / $48,000 = 0.25, which is a 25.00% increase.

Question 12

Wolfe Supply Co. sells hiking and other outdoor equipment. It also sells a few trail books and outdoor guides about the area. In their Income Statement, the revenue from the books and guides would probably be recorded as:
A)operating income.
B)other income.
C)other expenses.
D)extraordinary income.

Accepted Answer

The revenue from the books and guides is not a part of the company's primary business operations of selling outdoor equipment, therefore it cannot be recorded as operating income. It is also not an expense, so it cannot be recorded as other expenses. Extraordinary income is reserved for significant and unusual events, which selling a few books and guides does not qualify as. Therefore, the only appropriate option is to record it as "other income."

Question 13

Winter Coffee's cash reported on the comparative Balance Sheet was $236,000 in 2015 and $246,000 in 2016. The percentage change in cash from 2015 to 2016 was: (Round your final answer to two decimal places, X.XX%.)
A)+4.07%.
B)+4.24%.
C) -4.24%.
D) -4.07%.

Accepted Answer

The answer of Winter Coffee's cash reported on the comparative...

Question 14

Woods, Inc. reported Net Sales of $326,000, Cost of Goods Sold of $188,600, Operating Expenses of $59,900, and Income Tax Expense of $9300. Woods' net income percentage was: (Round your final answer to two decimal places, X.XX%.)
A)42.15%.
B)20.92%.
C)57.85%.
D)23.77%.

Accepted Answer

To calculate the net income percentage, we need to first calculate the net income, which is the difference between the net sales and the total expenses:

Net Income = Net Sales - Cost of Goods Sold - Operating Expenses - Income Tax Expense
Net Income = $326,000 - $188,600 - $59,900 - $9,300
Net Income = $67,200

Then we can calculate the net income percentage by dividing the net income by the net sales:

Net Income Percentage = (Net Income / Net Sales) x 100
Net Income Percentage = ($67,200 / $326,000) x 100
Net Income Percentage = 20.67%

Round to two decimal places, the net income percentage is 20.92%. Therefore, the best choice is B.

Question 15

Spirit's Signs reported Net Sales of $261,000, Cost of Goods Sold of $109,500, Operating Expenses of $62,400, and Income Tax Expense of 21,500. Spirit's net income percentage was: (Round your final answer to two decimal places, X.XX%.)
A)34.14%.
B)41.95%.
C)58.05%.
D)25.9%.

Accepted Answer

The answer of Spirit's Signs reported Net Sales of $261,000,...

Question 16

What was the percentage of change in Accounts Receivable if the balance was $80,000 in 2015 and $59,000 in 2016? (Round your final answer to two decimal places, X.XX%.)
A)-26.25%.
B)+26.25%.
C)-35.59%.
D)+35.59%.

Accepted Answer

The percentage change in Accounts Receivable from 2015 to 2016 is calculated as: [(59,000 - 80,000) / 80,000] * 100 = -26.25%.

Question 17

Dolly's Diamonds reported Net Sales of $254,000, Cost of Goods Sold of $107,500, Operating Expenses of $60,400, and Income Tax Expense of $21,600. Dolly's gross profit margin percentage was: (Round your final answer to two decimal places, X.XX%.)
A)33.9%.
B)42.32%.
C)57.68%.
D)25.39%.

Accepted Answer

Gross profit margin percentage is calculated as (Net Sales - Cost of Goods Sold) / Net Sales * 100. For Dolly's Diamonds, it is (($254,000 - $107,500) / $254,000) * 100 = 57.68%.

Question 18

Ironworks, Inc. has cost of goods sold for the years 2016, 2015 and 2014 respectively of $28,400, $26,400 and $25,100. If 2014 is the base year, the trend percentage for 2016 is: (Round your final answer to two decimal places, X.XX%.)
A)113.15%.
B)13.15%.
C)105.18%.
D)5.18%.

Accepted Answer

To calculate the trend percentage for 2016 using 2014 as the base year, you divide the cost of goods sold in 2016 by the cost of goods sold in 2014 and then multiply by 100. So, ($28,400 / $25,100) * 100 = 113.15%.

Question 19

Raven Industries reported Net Sales of $296,000, Cost of Goods Sold of $196,600, Operating Expenses of $57,900, and Income Tax Expense of 15,300. Raven Industries' gross profit margin percentage was: (Round your final answer to two decimal places, X.XX%.)
A)33.58%.
B)8.85%.
C)66.42%.
D)14.02%.

Accepted Answer

To calculate the gross profit margin percentage, we subtract the cost of goods sold from the net sales to get the gross profit which is $296,000 - $196,600 = $99,400.
Then, we divide the gross profit by the net sales and multiply by 100 to get the percentage: ($99,400 / $296,000) * 100 = 33.58%. Therefore, the answer is choice A, with a gross profit margin percentage of 33.58%.

Question 20

The sales of Sassycat, Inc. for the years 2014, 2015, and 2016 are $36,000, $59,000 and $76,000, respectively. If 2014 is the base year, the trend percentage for 2015 is: (Round your final answer to two decimal places, X.XX%.)
A)61.02%.
B)163.89%.
C)211.11%.
D)128.81%.

Accepted Answer

The trend percentage is calculated by taking the year of interest (2015 in this case), dividing its sales by the base year's sales (2014), and then multiplying by 100 to get a percentage. For 2015, this is ($59,000 / $36,000) * 100 = 163.89%.

Quiz 12: Financial Statement Analysis

Betta, Inc. reported $23,800 in A/R in 2016 and $25,200 in A/R in 2015. The percentage change in A/R from 2015 to 2016 was: (Round your final answer to two decimal places, X.XX%.)

Illusions, Inc. has current assets of $52,000, long-term assets of $262,700, current liabilities of $42,600, and long-term debt of $154,700. Illusions' debt ratio is: (Round your final answer to two decimal places, X.XX%.)

Danio's Diagnostics had a loss from discontinued operations of $130,000. If their corporate tax rate is 40%, at what amount will the loss be shown on the Income Statement?

Crowne Cottages, Inc. has current assets of $44,000, long-term assets of $250,900, current liabilities of $42,600, and long-term debt of $156,700. Crowne's debt ratio is: (Round your final answer to two decimal places, X.XX%.)

If cash is $4,170 in 2016 and $3,370 in 2015, what is the percent increase or decrease from 2015 to 2016? (Round your final answer to two decimal places, X.XX%.)

Which analysis deals with the percentage of changes in certain items over a period of years?

The revenue of Lionworks, Inc. for the years 2014, 2015, and 2016 are $79,000, $96,000 and $197,000, respectively. If 2014 is the base year, the trend percentage for 2015 is: (Round your final answer to two decimal places, X.XX%.)

TNT Guitar's sales were $13,100 in 2016 and $11,600 in 2015. The percentage change in TNT's sales from 2015 to 2016 was: (Round your final answer to two decimal places, X.XX%.)

A comparison of the amounts for the same item in the financial statements of two or more periods is called:

If current assets were $101,000 in 2015 and $91,000 in 2016, what was the amount of increase or decrease in percentage terms from 2015 to 2016? (Round your final answer to two decimal places, X.XX%.)

Net income was $48,000 in 2015 and $60,000 in 2016. The percentage increase or decrease in net income from 2015 to 2016 was: (Round your final answer to two decimal places, X.XX%.)

Wolfe Supply Co. sells hiking and other outdoor equipment. It also sells a few trail books and outdoor guides about the area. In their Income Statement, the revenue from the books and guides would probably be recorded as:

Winter Coffee's cash reported on the comparative Balance Sheet was $236,000 in 2015 and $246,000 in 2016. The percentage change in cash from 2015 to 2016 was: (Round your final answer to two decimal places, X.XX%.)

Woods, Inc. reported Net Sales of $326,000, Cost of Goods Sold of $188,600, Operating Expenses of $59,900, and Income Tax Expense of $9300. Woods' net income percentage was: (Round your final answer to two decimal places, X.XX%.)

Spirit's Signs reported Net Sales of $261,000, Cost of Goods Sold of $109,500, Operating Expenses of $62,400, and Income Tax Expense of 21,500. Spirit's net income percentage was: (Round your final answer to two decimal places, X.XX%.)

What was the percentage of change in Accounts Receivable if the balance was $80,000 in 2015 and $59,000 in 2016? (Round your final answer to two decimal places, X.XX%.)

Dolly's Diamonds reported Net Sales of $254,000, Cost of Goods Sold of $107,500, Operating Expenses of $60,400, and Income Tax Expense of $21,600. Dolly's gross profit margin percentage was: (Round your final answer to two decimal places, X.XX%.)

Ironworks, Inc. has cost of goods sold for the years 2016, 2015 and 2014 respectively of $28,400, $26,400 and $25,100. If 2014 is the base year, the trend percentage for 2016 is: (Round your final answer to two decimal places, X.XX%.)

Raven Industries reported Net Sales of $296,000, Cost of Goods Sold of $196,600, Operating Expenses of $57,900, and Income Tax Expense of 15,300. Raven Industries' gross profit margin percentage was: (Round your final answer to two decimal places, X.XX%.)

The sales of Sassycat, Inc. for the years 2014, 2015, and 2016 are $36,000, $59,000 and $76,000, respectively. If 2014 is the base year, the trend percentage for 2015 is: (Round your final answer to two decimal places, X.XX%.)