Question for Multiple choice questions and choose right and wrong questionsT/F

When analyzing financial statements, which ratio calculation measures management efficiency

ROE

Current ratio

Gross Margin %

None of the above

When analyzing financial statements, besides reviewing data year over year for comparisons, the analyst should also compare the data to the S&P 500

True

False

A decrease in fixed costs will increase the number of units that need to be sold in order to breakeven.

True

False

The Payback method takes the initial investment and divides it by the accelerated depreciation per year of the investment

True

False

In the Statement of Cash Flows, depreciation is ignored because it is a non cash expense.

True

False

The filing of a 10-K and an annual report are required by the Securities and Exchange Commission. Failure to do so can result in civil penalties levied against the corporation.

True

False

A negative cash flow from operations, a positive cash flow from investing and a positive cash flow from financing can indicate the a company is in financialtrouble.

True

False

Internal control in a small business requires an outside CPA to audit the company books.

True

False

Current Assets = 10,000Current Liabilities = 5,000, Long Term Liabilities = 5,000 and Fixed Assets = 20,000.The current ratio would be

None of the above

2:1

1:1

3:1

"Train your customers", as discussed in the Budgeting module, refers to training customers on how to properly use products that the company sells.

True

False

If the beginning cash balance in the Cash budget is $2,000 and the profit component from the Breakeven analysis is $10,000, the ending cash balance should be

None of the above

8,000

10,000

12,000