Data Anal Exam 2 Chapt 6

To compute the percentage change in a horizontal analysis from last year to this year, the computation will be:

(Current Year - Last Year)/ Last Year.

If the profit margin is 0.1142, asset turnover is 0.5619 and financial leverage is 1.2937, what is the return on asset?

0.0642 (.1142x.5619)

If the profit margin is 0.1142, asset turnover is 0.5619 and financial leverage is 1.2937, what is the return on equity?

0.0830 (.1142x.5619x1.2937)

All other things equal, in which of the following buckets would you expect the least amount of aged receivables to be?

91-120 days

Of the following measures, the best way to analyze the extreme values in the sample is to consider the __________.

maximum or minimum

The __________ recent the accounts receivable (i.e., shorter amount of time it has been outstanding), the __________ likely it will be that they will ultimately be collected.

more, more

While a __________ reorganizes and summarizes certain data using cross-tabulations without changing the underlying spreadsheet (or data), a __________ is a graphical depiction of those cross-tabulations.

pivottable; pivot chart

Of the following measures, the best way to analyze the variability in the sample is to consider the __________.

standard deviation

Descriptive analytics are characterized by __________ of the relevant data.

summarization

__________ analytics are often the first type of analytics performed that leads to other types of analytics for further investigation.

Descriptive

Diagnostic analytics emphasizes "What happened?".

False

Dupont analysis allows an analysis of profit margins, asset turnover and liquidity.

False

__________ provides comparative changes about various line items of each financial statement over time.

Horizontal analysis

Profit margin is computed as follows:

Net profit (net income) / Sales

The calculation for return on equity using Dupont Analysis is:

Profit margin x Asset turnover x Financial leverage

Comparing the extent of long-term debt to equity is an example of __________.

Ratio analysis

Which ratio does not include a component to evaluate financial leverage?

Return on assets

Asset turnover is computed as follows:

Sales / Assets

In vertical analysis, the relevant base for cost of goods sold is which of the following?

Sales revenue

__________ are brief, generally small, visuals that fit within one cell in Excel that visually depict what happened in the cells next to it.

Sparklines

Of the following measures, the best measure for evaluating firm efficiency in handling and using assets is __________.

asset turnover

In vertical analysis, the relevant base for long-term debt is which of the following?

Total assets

A company's descriptive statistics are appropriately compared to either 1) the economy as a whole, 2) the company's respective industry, 3) competitors and 4) the company's own prior performance.

True

Descriptive analytics are analytics that characterize, summarize, and organize features and properties of the data to facilitate understanding.

True

Financial statements already contain many of the counts, totals, sums, averages, subtotals, minimums, and maximums that are needed as part of accounting descriptive analytics.

True

__________ expresses financial information in relation to some relevant figure or base.

Vertical analysis

A __________ is a display of rectangles with area proportional to the underlying frequency of the data.

histogram

An illustration of the total aged receivables in each 30-day bucket is an example of a __________.

histogram

Descriptive quantitative analytic measures of financial statements to help evaluate liquidity, solvency, profitability and efficiency are called __________.

ratio analysis