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Financial Statement Analysis

Instructions:

Answer 50 questions in 15 minutes.
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Match each statement with the correct term.
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This is a study tool. The 3 wrong answers for each question are randomly chosen from answers to other questions. So, you might find at times the answers obvious, but you will see it re-enforces your understanding as you take the test each time.

1. Straight Line depreciation
[(Orginal Cost-Salvage)/Life in output units] * output units in production
(Cash+Marketable securities+Receivables)/Average Daily Expenditures
Cash+Marketable Securities+ Receivables)/Current Liabilities
Cost-Salvage/useful Life

2. Days of sales outstanding
(2/useful life)*(Cost-Depreciation)
365/receivables turnover
CFO-fixed capital investment+net borrowing
Total Debt/Total Asset

3. Working Capital Turnover
CFO/dividends paid
Cash+Marketable Securities+ Receivables)/Current Liabilities
Revenue/Average Working Capital
Taxes payable+Change in DTL - Change in DTA

4. Leverage
Revenue/Average Total Assets
CFO/average total assets
ROCE - ROA
Begininng inventories+purchases-COGS

5. Cash Ratio
COGS/Average Inventory
CFO/average total assets
EBT/Revenue
(Cash+Marketable Securities)/Current Liabilities

6. Fixed assets turnover
CFO/cash paid for long term asset
CFO/average total assets
Revenue/Average Fixed Assets
CFO/cash outflows from investing and financing

7. FCFF
(Cash+Marketable securities+Receivables)/Average Daily Expenditures
NI+ non-cash charges+[Interest expense*(1-T)]-fixed capital investment-working capital investments OR CFO+[Interest expense*(1-T)]-fixed capital investment
Purchases/Average trade payable
NI/Revenue

8. Pretax Income
EBT/Revenue
CFO-fixed capital investment+net borrowing
(market rate at issue)*(balance sheet value of the liability at beg period)
(CFO-preferred dividends)/weighted average number of common shares

9. Debt to equity

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10. CF per share
Annual Sales/Average receivables
(Cash+Marketable securities+Receivables)/Average Daily Expenditures
(CFO-preferred dividends)/weighted average number of common shares
STD of Sales/Mean Sales

11. Basic EPS
NI/Revenue
(NI-preferred dividends)/weighted average of common shares
EBT/Revenue
CFO/cash paid for long term asset

12. Reinvestment
NI available to common/average common equity
CFO/cash paid for long term asset
NI/average total equity
Total debt/(Total debt+Total shareholders equity)

13. Cash to ROE
(CFO-preferred dividends)/weighted average number of common shares
CFO/average total equity
CFO/cash outflows from investing and financing
STD of Sales/Mean Sales

14. Financial Leverage
Average Total Asset/Average total equity
Total Debt/Total shareholders' equity
Taxes payable+Change in DTL - Change in DTA
STD OI/mean OI

15. Number of days of payable
CFO/cash paid for long term asset
365/payable turnover ratio
NI/Revenue
Begininng inventories+purchases-COGS

16. Investing and financing
CFO/cash outflows from investing and financing
CFO/average total assets
Revenue/Average Total Assets
NI/average total equity

17. Cash to income
(EBIT+lease payments)/(interest payments+lease payments)
CFO/Net Revenue
NI+ non-cash charges+[Interest expense*(1-T)]-fixed capital investment-working capital investments OR CFO+[Interest expense*(1-T)]-fixed capital investment
CFO/operating income

18. Debt to capital
Cash+Marketable Securities+ Receivables)/Current Liabilities
Total debt/(Total debt+Total shareholders equity)
(Cash+Marketable Securities)/Current Liabilities
Revenue/Average Fixed Assets

19. Receivables Turnover
Annual Sales/Average receivables
STD of Sales/Mean Sales
(Cash+Marketable Securities)/Current Liabilities
STD NI/Mean NI

20. CV sales
(Cash+Marketable securities+Receivables)/Average Daily Expenditures
STD of Sales/Mean Sales
(NI-preferred dividends)+(convertible preferred dividends)+(convertible debt interest)*(1-T)/(weighted average of common shares+conv. preferred shares+conv.of debt+issuable from stock option)
(EBIT+lease payments)/(interest payments+lease payments)

21. Debt payment
CFO/dividends paid
CFO/cash long-term debt repayment
(Cash+Marketable securities+Receivables)/Average Daily Expenditures
365/Inventory turnover

22. CF to Revenue
NI+ non-cash charges+[Interest expense*(1-T)]-fixed capital investment-working capital investments OR CFO+[Interest expense*(1-T)]-fixed capital investment
(NI-preferred dividends)+(convertible preferred dividends)+(convertible debt interest)*(1-T)/(weighted average of common shares+conv. preferred shares+conv.of debt+issuable from stock option)
CFO/Net Revenue
(Cash+Marketable securities+Receivables)/Average Daily Expenditures

23. Income tax expense
Total Debt/Total shareholders' equity
COGS/Average Inventory
(EBIT+lease payments)/(interest payments+lease payments)
Taxes payable+Change in DTL - Change in DTA

24. Debt to Asset
365/Inventory turnover
Revenue/Average Fixed Assets
Total Debt/Total Asset
NI/Revenue

25. Dividend payment
CFO/dividends paid
CFO/average total equity
(days sales outstanding)+(Days of Inventory on hand)-(Number of days payable)
CFO-fixed capital investment+net borrowing

26. Operating return on assets
CFO/Net Revenue
Annual Sales/Average receivables
ROCE - ROA
EBIT/total asset

27. Interest coverage
[NI/sales][Sales/Assets][Assets/Equity]
365/receivables turnover
Annual Sales/Average receivables
(CFO+interest paid+taxes paid )/interest paid

28. Gross Profit Margin
NI/Average Total assets or [NI+interest expense(1-T)]/average total assets
CFO/cash paid for long term asset
(EBIT+lease payments)/(interest payments+lease payments)
Gross Profit/Revenue

29. Operating Profit Margin
Revenue/Average Working Capital
CFO/cash outflows from investing and financing
EBIT/Revenue
CFO/operating income

30. DDB
(2/useful life)*(Cost-Depreciation)
(CFO-preferred dividends)/weighted average number of common shares
EBT/Revenue
CFO/average total assets

31. CV Operating Income
NI/Revenue
NI/total capital
STD OI/mean OI
Cost-Salvage/useful Life

32. Quick Ratio
EBT/Revenue
CFO/dividends paid
Cash+Marketable Securities+ Receivables)/Current Liabilities
[NI/sales][Sales/Assets][Assets/Equity]

33. Return on common equity
CA/CL
NI/average total equity
NI available to common/average common equity
[(Orginal Cost-Salvage)/Life in output units] * output units in production

34. Defensive interval
(Cash+Marketable Securities)/Current Liabilities
NI/average total equity
Cash+Marketable Securities+ Receivables)/Current Liabilities
(Cash+Marketable securities+Receivables)/Average Daily Expenditures

35. Fixed charged coverage
(EBIT+lease payments)/(interest payments+lease payments)
CFO/Net Revenue
(market rate at issue)*(balance sheet value of the liability at beg period)
Average Total Asset/Average total equity

36. Return on total capital
NI/total capital
EBIT/total asset
CFO/dividends paid
(market rate at issue)*(balance sheet value of the liability at beg period)

37. Net Profit Margin
(2/useful life)*(Cost-Depreciation)
CFO/average total assets
CFO/Net Revenue
NI/Revenue

38. CV NI
(CFO+interest paid+taxes paid )/interest paid
STD NI/Mean NI
CFO/Net Revenue
NI/Average Total assets or [NI+interest expense(1-T)]/average total assets

39. Original DuPont:ROE
Revenue/Average Total Assets
COGS/Average Inventory
[NI/sales][Sales/Assets][Assets/Equity]
(NI-preferred dividends)/weighted average of common shares

40. Interest expense
(market rate at issue)*(balance sheet value of the liability at beg period)
NI/Revenue
EBIT/Revenue
NI/Average Total assets or [NI+interest expense(1-T)]/average total assets

41. Day of inventory on hand
CFO/average total equity
365/Inventory turnover
(CFO+interest paid+taxes paid )/interest paid
[NI/sales][Sales/Assets][Assets/Equity]

42. Cash Conversion Cycle
(days sales outstanding)+(Days of Inventory on hand)-(Number of days payable)
365/payable turnover ratio
EBT/Revenue
Cash+Marketable Securities+ Receivables)/Current Liabilities

43. Diluted EPS
(NI-preferred dividends)+(convertible preferred dividends)+(convertible debt interest)*(1-T)/(weighted average of common shares+conv. preferred shares+conv.of debt+issuable from stock option)
365/Inventory turnover
[NI/sales][Sales/Assets][Assets/Equity]
Average Total Asset/Average total equity

44. Total asset turnover
Revenue/Average Total Assets
(CFO-preferred dividends)/weighted average number of common shares
EBIT/Revenue
Total Debt/Total shareholders' equity

45. FCFE
CFO-fixed capital investment+net borrowing
Revenue/Average Fixed Assets
CFO/Net Revenue
NI/Revenue

46. Debt coverage
CFO/cash paid for long term asset
(NI-preferred dividends)+(convertible preferred dividends)+(convertible debt interest)*(1-T)/(weighted average of common shares+conv. preferred shares+conv.of debt+issuable from stock option)
CFO/Total debt
Cost-Salvage/useful Life

47. Ending inventories
EBIT/Revenue
STD NI/Mean NI
COGS/Average Inventory
Begininng inventories+purchases-COGS

48. Units in production
[(Orginal Cost-Salvage)/Life in output units] * output units in production
Cost-Salvage/useful Life
COGS/Average Inventory
[NI/sales][Sales/Assets][Assets/Equity]

49. Cash to ROA
COGS/Average Inventory
CFO/average total assets
Total debt/(Total debt+Total shareholders equity)
365/payable turnover ratio

50. Payable Turnover
Cash+Marketable Securities+ Receivables)/Current Liabilities
Purchases/Average trade payable
365/payable turnover ratio
365/Inventory turnover