Basic Financial Statements Analysis Done
Question 1:
2A1-AT03
When preparing common-size statements, items on the Balance Sheet are generally stated as a percentage of __________ and items on the Income Statement are generally stated as a percentage of __________.
total assets; net income.
total shareholders' equity; net income.
total shareholders' equity; net sales.
total assets; net sales.
Common-size balance sheets express all assets, liabilities, and equities as a percent of the balance sheet footing (total assets). Common-size income statements express all sales adjustments, expenses, gains, losses, other revenues, and taxes as a percent of sales.
Question 2:
2A1-LS02
A common-size statement is helpful:
for determining the next investment the company should make.
for considering whether to buy or sell assets.
in comparing companies of different sizes.
for figuring out how assets are allocated.
A common-size statement shows each major section of the financial statement valued at 100%, with its elements as percentages of the total, and is helpful when comparing companies of different sizes and when making comparisons from one year to another within the same company.
Question 3:
2A1-LS08
The financial statement that provides a summary of the firm's operations for a period of time is the:
*Source: Retired ICMA CMA Exam Questions.
statement of financial position.
statement of retained earnings.
statement of shareholders' equity.
income statement.
The financial statement that provides a summary of the firm's operations for a period of time is the income statement. It shows revenues, expenses, gains, losses, and taxes for the period.
Question 4:
2A1-LS09
All of the following are elements of an income statement except:
*Source: Retired ICMA CMA Exam Questions.
gains and losses.
shareholders' equity.
expenses.
revenue.
Shareholders' equity does not appear on an income statement. It appears on the balance sheet. Revenue, expenses, gains and losses all appear on an income statement.
Question
2A1-AT03
When preparing common-size statements, items on the Balance Sheet are generally stated as a percentage of __________ and items on the Income Statement are generally stated as a percentage of __________.
total assets; net income.
total shareholders' equity; net income.
total shareholders' equity; net sales.
total assets; net sales.
Common-size balance sheets express all assets, liabilities, and equities as a percent of the balance sheet footing (total assets). Common-size income statements express all sales adjustments, expenses, gains, losses, other revenues, and taxes as a percent of sales.
Question 2:
2A1-LS02
A common-size statement is helpful:
for determining the next investment the company should make.
for considering whether to buy or sell assets.
in comparing companies of different sizes.
for figuring out how assets are allocated.
A common-size statement shows each major section of the financial statement valued at 100%, with its elements as percentages of the total, and is helpful when comparing companies of different sizes and when making comparisons from one year to another within the same company.
Question 3:
2A1-LS08
The financial statement that provides a summary of the firm's operations for a period of time is the:
*Source: Retired ICMA CMA Exam Questions.
statement of financial position.
statement of retained earnings.
statement of shareholders' equity.
income statement.
The financial statement that provides a summary of the firm's operations for a period of time is the income statement. It shows revenues, expenses, gains, losses, and taxes for the period.
Question 4:
2A1-LS09
All of the following are elements of an income statement except:
*Source: Retired ICMA CMA Exam Questions.
gains and losses.
shareholders' equity.
expenses.
revenue.
Shareholders' equity does not appear on an income statement. It appears on the balance sheet. Revenue, expenses, gains and losses all appear on an income statement.
Question