Question

1.Zebra Company reports the following figures for the years ending December 31, 2019 and 2018:

	2019	2018
Net Sales	$65,000	$40,000
Cost of Goods Sold	42,000	31,000
Gross Profit	$23,000	$9,000

What are the percentage changes from 2018 to 2019 for Net Sales, Cost of Goods Sold and Gross Profit, respectively? (Round your final answers to one decimal place, X.X%)

A. 100%, 155.6%, 35.5%

B. 62.5%, 35.5%, 155.6%

C. 100%, 0.7%, 0.4%

D. 155.6%, 62.5%, 35.5%

2. Szidon Company reports the following data:

	Szidon	Key Competitor
Net income	$1,000,000	$500,000
Net income divided by net sales	1.9%	6.3%

Using benchmarking, what can be said about Szidon Company?

A. Szidon is inferior to the key competitor because the key competitor's net income percentage is higher.

B. There is not enough information to make any conclusions.

C. Szidon is superior to the key competitor because net income is higher.

D. There is conflicting information so no conclusions can be reached.

3. Mussa Corporation reports the following data:

Net sales	$280,000
Cost of goods sold	170,000
Gross profit	$110,000

In vertical analysis, the cost of goods sold percentage is closest to: (Round your final answer to the nearest whole percentage)

A. 61%.

B. 155%.

C. 39%.

D. 65%.

4. Marie's Clothing Store had an accounts receivable balance of $450,000 at the beginning of the year and a year-end balance of $610,000. Net credit sales for the year totaled $3,600,000. The average collection period of the receivables was: (Round any intermediary calculations to two decimal places and your final answer to the nearest day.)

A. 54 days.

B. 8 days.

C. 46 days.

D. 62 days.

5. Carey's Department Store had net sales of $20 million and cost of goods sold of $13.00 million for the year. The beginning inventory for the year was $5.00 million. The ending inventory for the year was $12.00 million. What was the days' inventory outstanding? (Round any intermediary calculations to two decimal places and your final answer to the nearest day.)

A.239 days

B. 28 days

C. 30 days

D. 73 days

6. The measure of a company's ability to collect cash from its customers who purchase on account is the

A. cash conversion cycle.

B. accounts payable turnover.

C. accounts receivable turnover.

D. days' payable outstanding.

7. A ratio that measures a company's profitability is the

A. leverage ratio.

B. times-interest-earned ratio.

C. gross margin percentage.

D. current ratio.

8. Marie's Clothing Store had an accounts receivable balance $480,000 at the beginning of the year and a year-end balance of $580,000. Net credit sales for the year totaled $2,800,000. The average collection period of the receivableswas: (Round any intermediary calculations to two decimal places and your final answer to the nearest day.)

A. 63 days.

B. 69 days.

C. 7 days.

D. 76 days

9. The ratio that measures the number of times that operating income can cover interest expense is the:

A. rate of return on total assets.

B. time−interest−earned ratio.

C. leverage.

D. debt ratio.

10. How is the cash conversion cycle computed?

A. days' inventory outstanding + days' sales outstanding − days' payable outstanding.

B. days' inventory outstanding − days' sales outstanding − days' payable outstanding.

C. days' inventory outstanding + days' sales outstanding + days' payable outstanding.

D. days' inventory outstanding − days' sales outstanding + days' payable outstanding.

Answer 1

Solution:

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