The ability to provide financial rewards sufficient to attract and retain financing is called:
  • Market prospects
  • Liquidity and efficiency
  • Profitability
  • Solvency
Financial statements with data for two or more successive accounting periods placed in columns side by side, sometimes with changes shown in dollar amounts and percents, are referred to as:
  • Inventory turnover
  • Comparative statements
  • Horizontal analysis
  • Common-size comparative statements
The ability to meet short-term obligations and to efficiently generate revenues is called:
  • Profitability
  • Liquidity and efficiency
  • Market prospects
  • Solvency
The measurement of key relations among financial statement items is known as:
  • Horizontal analysis
  • Profitability
  • Market prospects
  • Ratio analysis
Current assets divided by current liabilities is equal to the:
  • Profitability
  • Current ratio
  • Ratio analysis
  • Market prospects
The ability to generate positive market expectations is called:
  • Profitability
  • Liquidity and efficiency
  • Solvency
  • Market prospects
The average number of times a company's inventory is sold during an accounting period, calculated by dividing cost of goods sold by the average inventory balance is equal to the:
  • Inventory turnover
  • Liquidity and efficiency
  • Market prospects
  • Horizontal analysis
External users of financial information:
  • Current ratio
  • Market prospects
  • Are often based on a company's prior performance
  • Are not directly involved in operating the company
Comparative financial statements in which each amount is expressed as a percentage of a base amount and in which the base amount is expressed as 100%, are called:
  • Horizontal analysis
  • Comparative statements
  • Common-size comparative statements
  • Inventory turnover
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