#1
Which financial statement provides an overview of a company's revenues and expenses during a specific period?
Income Statement
ExplanationSummarizes financial performance over a specific time, detailing revenues and expenses.
#2
Which of the following is NOT a stakeholder in a company?
Competitors
ExplanationCompetitors are external entities, not internal stakeholders.
#3
Which financial statement reports a company's assets, liabilities, and shareholders' equity at a specific point in time?
Balance Sheet
ExplanationProvides a snapshot of a company's financial position at a specific date.
#4
What does the term 'working capital' represent?
The difference between current assets and current liabilities
ExplanationShows the funds available for a company's day-to-day operations.
#5
Which financial statement provides information about a company's sources and uses of cash during a specific period?
Statement of Cash Flows
ExplanationDetails cash inflows and outflows, revealing sources and uses of cash.
#6
What does the debt-to-equity ratio measure?
The proportion of debt financing relative to equity financing
ExplanationQuantifies the balance between debt and equity in a company's capital structure.
#7
What is the purpose of the DuPont analysis in financial analysis?
To assess a company's return on equity (ROE)
ExplanationBreaks down ROE into components for deeper analysis of profitability.
#8
Which financial ratio measures a company's ability to meet its short-term obligations with its most liquid assets?
Current Ratio
ExplanationAssesses short-term liquidity by comparing current assets to current liabilities.
#9
What does the term 'EBIT' represent in financial analysis?
Earnings Before Interest and Taxes
ExplanationIndicates operational profitability before interest and taxes.
#10
What does the term 'dividend yield' measure?
The percentage of earnings paid out as dividends to shareholders
ExplanationExpresses the dividend as a percentage of the stock's market price.
#11
Which financial ratio measures the efficiency of a company's use of its assets to generate revenue?
Asset Turnover Ratio
ExplanationEvaluates how well a company utilizes its assets to generate sales.
#12
In financial analysis, what does the term 'EBITDA' stand for?
Earnings Before Interest, Taxes, Depreciation, and Amortization
ExplanationMeasures operational profitability, excluding non-operating expenses.
#13
Which of the following is NOT a component of the DuPont analysis?
Return on Investment (ROI)
ExplanationROI is not part of DuPont analysis components; it assesses overall investment performance.