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D366 - Financial Statement Analysis
(Pre-Assessment) 2025/2026 Exam All
Answers and Illustrations Given
An investor is examining a company's balance sheet and subtracts current liabilities
from current assets. What is the investor trying to understand by this calculation?
Total capital
Book value
Working capital
Sales revenue - 🧠 ANSWER ✔✔Working capital
A company's chief financial officer (CFO) wants to determine how much cash is
used for normal business operations. Which element of a statement of cash flows
aids in this calculation?
Net cash used in investing activities
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COPYRIGHT©NINJANERD 2025/2026. YEAR PUBLISHED 2025. COMPANY REGISTRATION NUMBER: 619652435. TERMS OF USE. PRIVACY
STATEMENT. ALL RIGHTS RESERVED
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Increase in accounts receivable
Additions to property and equipment
Payment of dividends to stockholders - 🧠 ANSWER ✔✔Increase in accounts
receivable
A legal strategist is advising management on ways to gain market share and has
made growth-oriented investments. Sales have stayed stagnant despite the
investment, and the company wants to increase the company's valuation. Which
strategy should increase this company's common stock price?
Stock buybacks
Monthly dividends
Retained earnings
Repurchased debt - 🧠 ANSWER ✔✔Stock buybacks
An investor calculates a firm's basic earnings per share (EPS) and notices the ratio
has doubled year over year while the weighted average number of common shares
outstanding has remained constant. What caused the rise in the ratio?
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COPYRIGHT©NINJANERD 2025/2026. YEAR PUBLISHED 2025. COMPANY REGISTRATION NUMBER: 619652435. TERMS OF USE. PRIVACY
STATEMENT. ALL RIGHTS RESERVED
D366 - Financial Statement Analysis
(Pre-Assessment) 2025/2026 Exam All
Answers and Illustrations Given
An investor is examining a company's balance sheet and subtracts current liabilities
from current assets. What is the investor trying to understand by this calculation?
Total capital
Book value
Working capital
Sales revenue - 🧠 ANSWER ✔✔Working capital
A company's chief financial officer (CFO) wants to determine how much cash is
used for normal business operations. Which element of a statement of cash flows
aids in this calculation?
Net cash used in investing activities
1
COPYRIGHT©NINJANERD 2025/2026. YEAR PUBLISHED 2025. COMPANY REGISTRATION NUMBER: 619652435. TERMS OF USE. PRIVACY
STATEMENT. ALL RIGHTS RESERVED
, 2
Increase in accounts receivable
Additions to property and equipment
Payment of dividends to stockholders - 🧠 ANSWER ✔✔Increase in accounts
receivable
A legal strategist is advising management on ways to gain market share and has
made growth-oriented investments. Sales have stayed stagnant despite the
investment, and the company wants to increase the company's valuation. Which
strategy should increase this company's common stock price?
Stock buybacks
Monthly dividends
Retained earnings
Repurchased debt - 🧠 ANSWER ✔✔Stock buybacks
An investor calculates a firm's basic earnings per share (EPS) and notices the ratio
has doubled year over year while the weighted average number of common shares
outstanding has remained constant. What caused the rise in the ratio?
2
COPYRIGHT©NINJANERD 2025/2026. YEAR PUBLISHED 2025. COMPANY REGISTRATION NUMBER: 619652435. TERMS OF USE. PRIVACY
STATEMENT. ALL RIGHTS RESERVED
