Question: Explain Q. 1 In performing a horizontal analysis on a company's income statement, you notice that sales have decreased by 4%, but the gross profit

Explain

Q. 1

In performing a horizontal analysis on a company's income statement, you notice that sales have decreased by 4%, but the gross profit has increased by 10%. What are some factors that could cause this to happen?

Q.2

What are the benefits of ratio analysis? What are the limitations of ratio analysis? What can be done to minimize the limitations on ratio analysis? Explain.

Q.3

You have computed all of the liquidity ratios for a company, and each of them appears to be close to or better than the industry averages. What other information would you want before you made a final assessment of the company's short-term debt paying ability?

Q.4

What is a static budget? What is a flexible budget? Which is more useful, and why?

Q.5

What is the difference between a value-added and a non-value-added cost? Give an example of each.

Q.6

What is the product life cycle? How does it impact pricing decisions?

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