Questions from Financial Accounting

Q: How is a year-over-year percentage calculated?

How is a year-over-year percentage calculated?

Q: What is ratio analysis? Why is it useful?

What is ratio analysis? Why is it useful?

Q: What benchmarks are commonly used for interpreting ratios?

What benchmarks are commonly used for interpreting ratios?

Q: What benchmarks are commonly used for interpreting ratios?

What benchmarks are commonly used for interpreting ratios?

Q: Why are some analyses called horizontal and others called vertical?

Why are some analyses called horizontal and others called vertical?

Q: Slow Cellar’s current ratio increased from 1.2 to 1.

Slow Cellar’s current ratio increased from 1.2 to 1.5. What is one favorable interpretation of this change? What is one unfavorable interpretation of this change?

Q: From last year to this year, Colossal Company’s current ratio increased

From last year to this year, Colossal Company’s current ratio increased and its inventory turnover decreased. Does this imply a higher, or lower, risk of obsolete inventory?

Q: Briefly distinguish financial accounting from managerial accounting.

Briefly distinguish financial accounting from managerial accounting.

Q: From last year to this year, Berry Barn reported that its

From last year to this year, Berry Barn reported that its Net Sales increased from $300,000 to $400,000 and its Gross Profit increased from $90,000 to $130,000. Was the Gross Profit increase caused by...

Q: Last year, Rec Room Sports reported earnings per share of $

Last year, Rec Room Sports reported earnings per share of $8.50 when its stock price was $212.50. This year, its earnings increased by 20 percent. If the P/E ratio remains constant, what is likely to...