Ch 6 Quiz

If the profit margin is 0.0891, asset turnover is 0.4732 and financial leverage is 1.1957, what is the return on equity?

0.0504

If the profit margin is 0.2158, asset turnover is 0.5389 and financial leverage is 1.2047, what is the return on asset?

0.1163

If the profit margin is 0.2158, asset turnover is 0.5389 and financial leverage is 1.2047, what is the return on equity?

0.1401

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

The __________ reveals the detailed company cash inflows and cash outflows during the year.

statement of cash flows

Descriptive analytics are characterized by __________ of the relevant data.

summarization

Descriptive analytics of a return on market equity performed by researchers, __________ , provide examples of a possible anomaly right around zero that requires further analysis.

Burgstahler and Dichev

The Dupont Analysis measures which of these performance categories?

Profitability, Activity, and Solvency

Which measure would help us evaluate what happens in the highest and lowest 20 percent of the data?

Quintiles

Asset turnover is computed as follows:

Sales / Assets

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

Total assets

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

Vertical analysis

In addition to an aging analysis to establish an allowance for doubtful accounts, a __________ system may be used to assess the ability of customers to pay outstanding receivables.

customer relationship management (CRM)

A diagram showing interrelationships between two or more variables is called a __________.

graph

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

histogram

The calculation (New - Old)/Old would be used primarily in:

horizontal analysis

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

ratio analysis

An analysis which expresses financial information in relation to some relevant figure or base is called __________.

vertical analysis