ISOM Exam III || Guaranteed Pass.
Molly is preparing a balance sheet for her pet grooming company. Following long-established
traditions. She lists items on her balance sheet on the basis of their...?
a. competitive value
b. perceived market value
c. present values
d. original cost minus accumulated depreciation correct answers d. original cost minus
accumulated depreciation.
Thompson is a manager at a bank. He has to decide whether to lend $10,000 to Safe Toys, a
company that produces toys that don't have a choking hazard. He should
a. approve the loan application without checking the company's credibility.
b. review the company's financial statements
c. report the organization's financial performance to outsiders
d. turn down the loan application correct answers b. review the company's financial statement
Which of the following is one of the most common format for balance sheets?
a. horizontal
b. vertical
c. diagonal
d. revised
e. modern correct answers b. vertical
Aaron's Automobiles experienced a huge recall on one of its best selling cars, and it had to spend
$10 billion to fix all the recalled cars. Which of the following is most likely?
a. higher profit margin and return on every dollar of revenue
b. increased earnings per share and significantly spiked profitability ratios
c. decreased earnings per share and significantly reduced profitability ratios
, d. lower profit margin ad higher return on equity
e. lower return on equity and higher profit margin correct answers c. decreased earnings per
share and significantly reduced profitability ratios
Profitability ratios measure
a. how efficiently a firm uses its assets to generate sales
b. how much debt the firm is using relative to other sources of financing
c. how much operating income or net income a firm is able to generate relative to its assets,
equity, and sales
d. the speed with which a company can turn its short-term assets into cash to pay off its short-
term debts
e. the performance of the firm relative to others on a per-share basis correct answers c. how much
operating income or net income a firm is able to generate relative to its assets, equity, and sales
___________ ratios provide information about how much debt an organization is using relative
to other sources of capital, such as owners equity
a. Debt utilization
b. Quick
c. Asset utilization
d. Receivables turnover
c. Current correct answers Debt utilization
A company with a low return on assets
a. is making profits
b. does not have debts
c. is not using its assets very productively
d. is landing its assets to other companies
e. invests money in its assets correct answers is not using its assets very productively
Molly is preparing a balance sheet for her pet grooming company. Following long-established
traditions. She lists items on her balance sheet on the basis of their...?
a. competitive value
b. perceived market value
c. present values
d. original cost minus accumulated depreciation correct answers d. original cost minus
accumulated depreciation.
Thompson is a manager at a bank. He has to decide whether to lend $10,000 to Safe Toys, a
company that produces toys that don't have a choking hazard. He should
a. approve the loan application without checking the company's credibility.
b. review the company's financial statements
c. report the organization's financial performance to outsiders
d. turn down the loan application correct answers b. review the company's financial statement
Which of the following is one of the most common format for balance sheets?
a. horizontal
b. vertical
c. diagonal
d. revised
e. modern correct answers b. vertical
Aaron's Automobiles experienced a huge recall on one of its best selling cars, and it had to spend
$10 billion to fix all the recalled cars. Which of the following is most likely?
a. higher profit margin and return on every dollar of revenue
b. increased earnings per share and significantly spiked profitability ratios
c. decreased earnings per share and significantly reduced profitability ratios
, d. lower profit margin ad higher return on equity
e. lower return on equity and higher profit margin correct answers c. decreased earnings per
share and significantly reduced profitability ratios
Profitability ratios measure
a. how efficiently a firm uses its assets to generate sales
b. how much debt the firm is using relative to other sources of financing
c. how much operating income or net income a firm is able to generate relative to its assets,
equity, and sales
d. the speed with which a company can turn its short-term assets into cash to pay off its short-
term debts
e. the performance of the firm relative to others on a per-share basis correct answers c. how much
operating income or net income a firm is able to generate relative to its assets, equity, and sales
___________ ratios provide information about how much debt an organization is using relative
to other sources of capital, such as owners equity
a. Debt utilization
b. Quick
c. Asset utilization
d. Receivables turnover
c. Current correct answers Debt utilization
A company with a low return on assets
a. is making profits
b. does not have debts
c. is not using its assets very productively
d. is landing its assets to other companies
e. invests money in its assets correct answers is not using its assets very productively
