Data Analytics Exam 2

Réussis tes devoirs et examens dès maintenant avec Quizwiz!

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.

tools to measure variability

-max/min -stand dev -quartiles (4) / deciles (10)

tools to measure central tendencies

-mean -median -mode

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

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

calculate confidence interval by

1 - alpha

what percentage of data is within 1 standard deviation of the mean?

68%

what percentage of data is within 2 standard deviationsof the mean?

95%

what percentage of data is within 3 standard deviations of the mean?

99%

What is the Excel formula to compute the internal rate of return for a $32,000 investment and cash inflows of $10,000 per year for years 1 through 4?

=IRR(−33000,10000,10000,10000,10000)

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

horizontal analysis

When using regression analysis, the relationship between two variables matters when you are trying to understand __________.

how an independent variable impacts a dependent variable

Performing a bank reconciliation is example of the diagnostic analytics of __________.

identifying anomalies/outliers

Marginal analysis __________ sunk costs (past spending that cannot be recovered).

ignores

the bigger the loan request (loan amount), the ______ likely the loan be approved (loan acceptance)

less

Predictive and prescriptive analytics provide __________ deterministic output and __________ probabilistic models (judging the likelihood (probability) of a future event or outcome occurring) as compared to descriptive and diagnostic analytics.

less; more

What would be the independent variable in a regression determining "How are firm overhead costs dependent on the time for production?" at a manufacturing company?

machine hours

The practice of bringing specific issues to the attention of management if they depart from expectation is called __________.

management by exception

The technique used in management accounting to determine the change in profit associated with the cost or benefit of the next (or the marginal) unit is called __________.

marginal analysis

the best way to analyze the extreme values in the sample is to consider the __________.

max and min

longer employment length, the ____ likely the loan will be accepted

more

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

technique used to find potential matches when there's less than an exact match

muzzy match

there is a ______ relationship between loan acceptance and the debt-to-income ration

negative

profit margin equation

net profit (or net income) / sales

A _______ t-test has more power than a _______ t-test.

one-tailed; two tailed

What is an observation that lies outside its expected distribution?

outlier

horizontal analysis compares changes of line items on financial statements ________

over time, using % change

Diagnostic analytics is broken down into all categories except for _________.

performing descriptive analytics

Analytics of the inventory item that produces the most profit is an example of the diagnostic analytics of __________.

performing drill-down detailed analytics

Diagnostic analysis includes all of the possible types of analytics except for which of the following?

performing marginal analysis

__________ is the repeatability of the financial statement variables (e.g., earnings, sales, cash flows) over time.

persistence

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

sparklines

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

DuPont ratio

summarizes and disaggregates company performance and the return on equity ratio

An example of goal-seek analysis is determining __________.

the amount of sales to break even

__________ is the cost of available funds for a company, which acts as a hurdle rate that the company must overcome to create value.

the cost of capital

Bedford's Law

the frequency of a number decreases exponentially as the digit gets bigger (1 is more likely to occur than 2)

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

the oldest bucket

Null Hypothesis (H0)

the statistical hypothesis tested by the statistical procedure; usually a hypothesis of no difference or no relationship

alpha is the

threshold value to determine if the statistic tested is significant

Forecasting sales for budget purposes is an example of which type of predictive analytics?

time series

Using past performance to predict future performance is called __________.

time series

What kind of analytics is generally used to forecast future sales, earnings, and cash flows from operating activities?

time series

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

total assets

What would be the dependent variable in a regression determining "How are firm costs dependent on the level of production?" at a decking company?

total production costs

ROA (DuPont Analysis)

2 components -profit margin -asset turnover

ROE (DuPont Analysis)

3 components -profit margin -asset turnover -financial leverage

What type of analytics addresses questions of "What happened?"?

Descriptive analytics

Diagnostic analytics emphasizes "What happened?".

False

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

False (not liquidity; is financial leverage)

Testing for duplicate transactions is an example of what type of diagnostic analytics?

ID anomalies and outliers

The interest rate calculated to the point where the present value of cash inflows is equal to the present value of cash outflows is called __________.

IRR (internal rate of return)

__________ is used to help find customers that might have a similar address or name as employees.

Fuzzy matching

If the data analyst hypothesizes that grocery sales are higher on Sunday than on other days, the null hypothesis would likely state that:

Grocery sales are lower or no different on Sunday than on other days.

What type of analytics would address the question of whether a company will go bankrupt?

Predictive analytics

The calculation for return on equity using Dupont Analysis is:

Profit margin x Asset turnover x Financial leverage

alternative hypothesis

The hypothesis that states there is a difference between two or more sets of data. (Opposite of null hypothesis)

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

A realistic expectation an accountant could hold is that addresses of the company vendors are not similar to that of the company employees.

True

A realistic expectation an accountant may hold is that "Most accounting transactions are made and recorded during normal work hours and normal workdays".

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

Prescriptive analytics will optimize the decisions based on the forecast of the future.

True

Standard cost is an estimated, or expected, cost of producing a good or service used in management accounting.

True

The balance in the cash account is deterministic as compared to being probabilistic.

True

Which tool is generally associated with prescriptive analytics?

What-if scenario

Which type of question does diagnostic analytics address?

Why did it happen?

Which type of question does predictive analytics address?

Will it happen in the future?

Paramater

a characteristic of a population

the best measure for evaluating firm efficiency in handling and using assets is __________.

asset turnover

The persistence of operating income as compared to cash flows from operations is consistent with GAAP requiring the use of __________ accounting for financial reporting purposes.

accrual-basis

If we are running a regression to analyze the question if advertising expenses are related to sales revenue outcomes, what would be the independent variable?

advertising expense

deterministic models

all events are known beg=froe hand (descriptive and diagnostic)

probabilistic models

always an element of chance of whether or not something will happen (predictive and prescriptive)

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

an example of a histogram

A series (such as monthly or annually) of fixed payments is called a(n) __________.

annuity

if a company has higher sales rev and asset turnover, it means that stockholders _______

are more profitable

accounts receivable aging puts outstanding accounts receivable in monthly ______ for further analysis

buckets

statistic

characteristic of a sample

What kind of analytics is generally used to predict whether a company's financial statements are fraudulent?

classification

Which predictive analytics technique would be used to predict whether a firm is likely to have a material misstatement in the coming year?

classification

If we run a regression where y (college completion rate) = f (factors potentially predicting college completion rate), what is the dependent variable?

college completion rate

sunk cost fallacy

commitment to prior investment escalates and makes it harder to abandon prior investments even if it may not be a rational one

In a bank reconciliation, outstanding checks are recorded by the __________, but not yet by the __________.

company; bank

chi-squared test

compares annual and expected distribution of 1st digit using Bedford's Law

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

descriptive

What type of analytics would primarily summarize facts and compute sums, averages, counts, etc.?

descriptive analytics

Evaluating the relationship between R&D expenditures and net income is an example of the diagnostic analytics of __________.

determining relations/patterns/linkages between variables through statistical analysis

What type of analytics would include Benford's law to assess whether fraud had occurred?

diagnostic analytics

confidence interval

estimated interval that may contain the population mean

p-value > alpha

fail to reject the null hypothesis (not significant result)

Which type of analysis would predictive analytics not be useful?

finding anomalies and outliers

If the critical value for a one-tailed t-test at the α = 0.05 level is 1.645, the t-statistic needed to reject the null hypothesis of no difference would be _______.

greater than 1.645

According to Altman's Z, the __________ amount of long-term profitability generally leads to __________ risk of bankruptcy.

greater; lower

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

histogram

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

M score

predicts likelihood to commit fraud

If we wanted to know what level of sales would be needed to break even given the current economic environment, we would call that _______ analytics.

prescriptive

What type of analytics would primarily use what-if analysis, scenario manager, and goal seek analysis?

prescriptive analytics

p-value is the

probability of obtaining the observed results

base rate

probability of some event happening based on some historical average

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

ratio analysis

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

ratio analysis

Estimating the appropriate cost driver as part of activity-based costing is an example of which type of predictive analytics?

regression

If p-value < = alpha threshold, you should:

reject the null hypothesis (i.e., significant result).

p-value < alpha

reject the null hypothesis (significant result)

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

return on assets

asset turnover equation

sales / assets

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

sales revenue

The test to see if the key number field in a record is in correct ascending or descending order is called a(n) __________ check.

sequence

test to see if key number field in record is in correct ascending/descending order

sequence check

If the p-value of the chi-square test is __________ than the α (alpha) threshold, we could conclude that the observed relationship is __________ than that expected from Benford's law.

smaller, different

drill-down analysis looks for

underlying patterns in the data at detailed level

Which distribution is a probability distribution where all outcomes are equally likely?

uniform distribution

The practice of identifying the difference between a budget amount and actual performance is called:

variance analysis

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

vertical analysis

Which statistic tells us how many standard deviations (σ), a data point (or observation), xi, is from its population mean, μ?

z-score


Ensembles d'études connexes

Chapter 33: Coronary Artery Disease and Acute Coronary Syndrome

View Set

Microbiology Test 1 Chapter 1,2,3

View Set

Chapter 2 - Global, ethical, and sustainable marketing

View Set