#1
What is the purpose of financial analysis?
To evaluate the financial performance of a company
ExplanationAssesses company's financial performance.
#2
Which of the following is a liquidity ratio?
Current Ratio
ExplanationMeasures company's liquidity.
#3
Which financial statement shows a company's revenues and expenses over a period?
Income statement
ExplanationShows revenue and expenses.
#4
What is the primary purpose of financial modeling?
To forecast future financial performance
ExplanationForecasts future financial performance.
#5
Which financial statement shows changes in a company's cash and cash equivalents over a period?
Cash flow statement
ExplanationShows cash changes over time.
#6
What does the P/E ratio indicate?
Investor's sentiment towards a company
ExplanationReflects investor sentiment.
#7
Which of the following is NOT a method of corporate valuation?
Inventory Valuation
ExplanationNot a corporate valuation method.
#8
What does the Altman Z-score measure?
Credit risk
ExplanationIndicates credit risk.
#9
What is the formula for calculating the Return on Assets (ROA)?
Net Income / Total Assets
ExplanationNet income relative to total assets.
#10
Which of the following is a measure of a company's efficiency in collecting receivables?
Days Sales Outstanding (DSO)
ExplanationEfficiency in receivables collection.
#11
Which financial ratio measures a company's ability to meet short-term obligations with its most liquid assets?
Quick Ratio
ExplanationMeasures short-term liquidity.
#12
What does the DuPont analysis assess?
Profitability of a company
ExplanationEvaluates company profitability.