Question :
141. The following information pertains to Tanzi Company. Assume that all : 1234280
141. The following information pertains to Tanzi Company. Assume that all balance sheet amounts represent both average and ending balance figures. Assume that all sales were on credit.
Assets
Cash and short-term investments $ 40,000
Accounts receivable (net) 30,000
Inventory 25,000
Property, plant and equipment 215,000
Total Assets$310,000
Liabilities and Stockholders’ Equity
Current liabilities 60,000
Long-term liabilities 95,000
Stockholders’ equity-common 155,000
Total Liabilities and stockholders’ equity$310,000
Income Statement
Sales $ 90,000
Cost of goods sold 45,000
Gross margin 45,000
Operating expenses 20,000
Net income$ 25,000
Number of shares of common stock 6,000000
Market price of common stock $20
Dividends per share 1.00
Cash provided by operations $40,000
What is the price earnings ratio for this company? A. 6 timesB. 4.2 timesC. 8 timesD. 9.6 times
142. The following information pertains to Tanzi Company. Assume that all balance sheet amounts represent both average and ending balance figures. Assume that all sales were on credit.
Assets
Cash and short-term investments $ 40,000
Accounts receivable (net) 30,000
Inventory 25,000
Property, plant and equipment 215,000
Total Assets$310,000
Liabilities and Stockholders’ Equity
Current liabilities 60,000
Long-term liabilities 95,000
Stockholders’ equity-common 155,000
Total Liabilities and stockholders’ equity$310,000
Income Statement
Sales $ 90,000
Cost of goods sold 45,000
Gross margin 45,000
Operating expenses 20,000
Net income$ 25,000
Number of shares of common stock 6,000000
Market price of common stock $20
Dividends per share 1.00
Cash provided by operations $40,000
What is the earnings per share on common stock? A. $4.17B. $6.66C. $1.00D. $5.00
143. Percentage analyses, ratios, turnovers, and other measures of financial position and operating results are A. a substitute for sound judgment.B. useful analytical measures.C. enough information for analysis, industry information is not needed.D. unnecessary for analysis, but reaction is better.
144. The following information pertains to Tanzi Company. Assume that all balance sheet amounts represent both average and ending balance figures. Assume that all sales were on credit.
Assets
Cash and short-term investments $ 40,000
Accounts receivable (net) 30,000
Inventory 25,000
Property, plant and equipment 215,000
Total Assets$310,000
Liabilities and Stockholders’ Equity
Current liabilities 60,000
Long-term liabilities 95,000
Stockholders’ equity-common 155,000
Total Liabilities and stockholders’ equity$310,000
Income Statement
Sales $ 90,000
Cost of goods sold 45,000
Gross margin 45,000
Operating expenses 20,000
Net income$ 25,000
Number of shares of common stock 6,000000
Market price of common stock $20
Dividends per share 1.00
Cash provided by operations $40,000
What is the rate earned on stockholders’ equity? Round answer to a single decimal point. A. 7.3%B. 16.1%C. 23.5%D. 53.3%
145. Corporate annual reports typically do not contain which of the following? A. management discussion and analysisB. SEC statement expressing an opinionC. accompanying foot notesD. auditor’s report
146. The independent auditor’s report does which of the following? A. describes which financial statements are covered by the auditB. gives the auditor’s opinion regarding the fairness of the financial statementsC. summarizes what the auditor didD. states that the financial statements are truthful
147. The purpose of an audit is to A. determine whether or not a company is a good investment.B. render an opinion on the fairness of the statements.C. determine whether or not a company complies with income tax regulations.D. determine whether or not a company is a good credit risk.
148. The Cash and Accounts Receivable for a company are provided below:
2008 2007
Cash$65,000$50,000
Accounts receivable (net)$75,200$80,000
Based on this information, what is the amount and percentage of increase or decrease that would be shown in a balance sheet with horizontal analysis?
149. The Cash and Accounts Receivable for a company are provided below:
2008 2007
Cash$64,800$60,000
Accounts receivable (net)$46,000$50,000
Based on this information, what is the amount and percentage of increase or decrease that would be shown in a balance sheet with horizontal analysis?
150. Income statement information for Sims Company is provided below:
Sales$120,000
Cost of goods sold 84,000
Gross profit$ 36,000
Prepare a common sized income statement for Sims Company.
151. Why would you or why wouldn’t you compare an organization like Ford Motor Company to the local car dealer “City Ford/Lincoln/Mercury” in vertical and horizontal analysis?
