Question 11 A common size income statement is created by dividing all items on t

Question

Question 11

A common size income statement is created by dividing all items on the income statement by

net income

sales

total assets

equity

the number of shares of common stock outstanding

4 points   

Question 12

An increase in interest expense will ______________ a firm's net income and ___________ the firm's (net) cash flow.

decrease, decrease

decrease, increase

increase, decrease

increase, increase

4 points   

Question 13

Which of the following would increase a firm's cash flow from investing activities?

a decrease in accounts payable

a decrease in gross fixed assets

issuing new shares of common stock

a decrease accounts receivable

the sale of a large amount of inventory for cash

4 points   

Question 14

The primary concern of a firm's suppliers when assessing the strength of a firm is the firm's

return on assets

times interest earned

current ratio

total asset turnover

net income

sales

total assets

equity

the number of shares of common stock outstanding

Explanation / Answer

1. (B) Sales

2. (A) Decrease, Decrease

3. (B) decrease in Fixed Assets

4. (C) Current ratio

Thanks

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