Quiz_Week6 - statement and balance sheet. Required: Briefly...

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1. In 2006, ABC Company reported earnings per share of $2.00 for 10,000 shares. In 2007, there was a 2-for-1 stock split, for which 2007 earnings per share were reported at $2.10. The appropriate earnings per share presentation for a 2-year comparative analysis would be: 2007 2006 1.  $1.05 $2.00 2.  $2.10 $2.00 3.  none of the answers are correct 4.  $2.10 $1.00 5.  $1.05 $2.00
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2. Cash flow per share is a better indication of a firm's ability to make capital expenditure decisions and pay dividends than is earnings per share. 1. False 2. True
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3.
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4. Working capital is considered to be one of the prime indicators of liquidity. 1. False 2. True
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5.
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6. The statement of cash flows was added as a required financial statement to overcome deficiencies of the income
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Unformatted text preview: statement and balance sheet. Required: Briefly describe the purpose of each of these three financial statements. Indicate in your answer how the statement of cash flows helped overcome the shortcomings of the other two statements. 7. Which of the following is the focus for the statement of cash flows? 1. cash 2. none of the answers are correct 3. cash and cash equivalents 4. current assets 5. working capital 8. 9. 10. 11. The operating cash flow/total debt ratio is one that indicates a firm's ability to meet its current maturities of debt. 1. True 2. False...
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Quiz_Week6 - statement and balance sheet. Required: Briefly...

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