Practice Quiz 10B
Complete the following quiz for the lesson: Financing Statement Analysis
Untitled Question *
1 point
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A company's book value per share is generally a good indicator of the market value of a company's stock. *
1 point
A company's P/E ratio *
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A high PIE ratio is an indicator that the price of a company's stock is overvalued. *
1 point
As a general rule, if a company's stock price decreases from one day to the next, it is an indication that the investing public's expectation of the company's future profits have decreased. *
1 point
Vertical analysis is an important tool in trying to project a company's future profitability. *
1 point
Vertical Analisys *
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Assuming a company reduced the sales price of its products from one year to the next in order to attract more customers and increase overall sales revenues, and at the same time the company's cost of goods sold as a percentage of sales revenues increased during the year, then the average cost from suppliers of the company's products must have increased during the year. *
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If gross margin as a percentage of sales revenues decreases over the year and the cost per unit of inventory purchases was stable throughout the year (no inflation or deflation in inventory costs), then *
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It is possible for selling and administrative expense as a percentage of sales revenue to decrease in a period of increasing sales. *
1 point
In a period of increasing sales revenues lower selling and administrative expenses as a percentage of sales revenues may reflect: *
1 point
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