Chapter 16 practice quiz

Chapter 16 practice quiz - Chapter 16 Financial Statement...

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Chapter 16 Financial Statement Analysis Practice Quiz 1. Which of the following ratios help users to assess the company’s ability to meet currently maturing or short-term obligations? Acid-test Ratio Debt to Equity Ratio A. Yes No B. No Yes C. No No D. Yes Yes 2. Sand Company has an acid test ratio of 0.02 to 1. Which of the following actions would improve the acid-test ratio? A. Collect accounts receivable B. Acquire inventory on account C. Sell equipment for cash D. Use cash to pay off accounts payable E. Both C and D 3. Sea Company has a current ratio of 2.5 to 1. Which of the following actions would improve the current ratio? A. Collect accounts receivable B. Acquire inventory on account C. Sell equipment for cash D. Use cash to pay off accounts payable E. Both C and D Questions 4-5 use the following information: Bragg Company recorded the following data for 2006 and 2007: 2006 2007 Sales $200,000 $180,000 Cost of Goods Sold 100,000 80,000 Net Income 40,000 36,000 Accounts Receivable, December 31
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This test prep was uploaded on 04/22/2008 for the course ACC 2304 taught by Professor Robinson during the Spring '08 term at Baylor.

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Chapter 16 practice quiz - Chapter 16 Financial Statement...

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