CMA（P2）——Financial Statement Analysis

信息来源：金融范    2014-10-10 10:11    knroman

Financial statement analysis
A.1.1. Gordon has had the following financial results for the last four years.
 

	Year 1	Year 2	Year 3	Year 4
Sales	$1,250,000	$1,300,000	$1,359,000	$1,400,000
Cost of goods sold	$750,000	$785,000	$825,000	$850,000
Gross profit	$500,000	$515,000	$534,000	$550,000
Inflation factor	1.00	1.03	1.07	1.10

Gordon has analyzed these results using vertical common-size analysis to determine trends. The performance of Gordon can best be characterized by which one of the following statements?
A. The common-size gross profit percentage has decreased as a result of an increasing common-size trend in cost of goods sold.
B. The common-size trend in sales is increasing and is resulting in an increasing trend in the common-size gross profit margin.
C. The common-size trend in cost of goods sold is decreasing which is resulting in an increasing trend in the common-size gross profit margin.
D. The increased trend in the common-size gross profit percentage is the result of both the increasing trend in sales and the decreasing trend in cost of goods sold.

A.1.2. All of the following are classifications on the Statement of Cash Flows except
A. operating activities.
B. equity activities.
C. investing activities.
D. financing activities.

A.1.3. Long-term debt should be included in the current section of the statement of financial position if
A. it is to be converted into common stock before maturity.
B. it matures within the year and will be retired through the use of current assets.
C. management plans to refinance it within the year.
D. a bond retirement fund has been set up for use in its scheduled retirement during the next year.

A.1.4. The following information pertains to Maynard Corporation’s Income Statement for the twelve months just ended. The company has an effective income tax rate of 40%.
Discontinued operations $(70,000)
Extraordinary loss due to earthquake (90,000)
Income from continuing operations (net of tax) 72,000
Cumulative effect of change in accounting principle 60,000
Maynard’s net income for the year is
A. $36,000.
B. $12,000.
C. $(16,000).
D. $(24,000).

A.1.5. Dixon Company has the following items recorded on its financial records.
Available-for-sale securities $200,000
Prepaid expenses 400,000
Treasury stock 100,000
The total amount of the above items to be shown as Assets on Dixon’s Statement of Financial Position is
A. $400,000.
B. $500,000.
C. $600,000.
D. $700,000.

A.1.6. The most commonly used method for calculating and reporting a company’s net cash flow from operating activities on its statement of cash flows is the
A. direct method.
B. indirect method.
C. single-step method.
D. multiple-step method.

A.1.7. Larry Mitchell, Bailey Company’s controller, is gathering data for the Statement of Cash Flows for the most recent year end. Mitchell is planning to use the direct method to prepare this statement, and has made the following list of cash inflows for the period.
· Collections of $100,000 for goods sold to customers.
· Securities purchased for investment purposes with an original cost of $100,000 sold for $125,000.
· Proceeds from the issuance of additional company stock totaling $10,000.
The correct amount to be shown as cash inflows from operating activities is
A. $100,000.
B. $135,000.
C. $225,000.
D. $235,000.

A.2-3.1. Archer Inc. has 500,000 shares of $10 par value common stock outstanding. For the current year, Archer paid a cash dividend of $4.00 per share and had earnings per share of $3.20. The market price of Archer’s stock is $36 per share. The average price/earnings ratio for Archer’s industry is 14.00. When compared to the industry average, Archer’s stock appears to be
A. overvalued by approximately 25%.
B. overvalued by approximately 10%.
C. undervalued by approximately 10%.
D. undervalued by approximately 25%.

A.2-3.2. A steady drop in a firm’s price/earnings ratio could indicate that
A. earnings per share has been increasing while the market price of the stock has held steady.
B. earnings per share has been steadily decreasing.
C. the market price of the stock has been steadily rising.
D. both earnings per share and the market price of the stock are rising.

A.2-3.3. Ray Company has 530,000 common shares outstanding at year-end. At December 31, for basic earnings per share purposes, Ray computed its weighted average number of shares as 500,000. Prior to issuing its annual financial statements, but after year-end, Ray split its stock 2 for 1. Ray's weighted average number of shares to be used for computing annual basic earnings per share is
A. 500,000.
B. 530,000.
C. 1,000,000.
D. 1,060,000.

A.2-3.4. Residco Inc. expects net income of $800,000 for the next fiscal year. Its target and current capital structure is 40% debt and 60% common equity. The director of capital budgeting has determined that the optimal capital spending for next year is $1.2 million. If Residco follows a strict residual dividend policy, what is the expected dividend payout ratio for next year?
A. 90%
B. 40%
C. 10%
D. 67%

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