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c. Equity multiplier
d. Debt ratio
A company's net income after tax was P400,000 for its most recent year. The company's income
statement included Income Tax Expense of P140,000 and Interest Expense of P60,000. At the beginning
of the year the company's stockholders' equity was P1,900,000 and at the end of the year it was
P2,100,000.
a. 6.7
b. 9.0
c. 10.0
d. 8.7
a. 20%
b. 25%
c. 30%
d. 35%
5. When the concept of ratio is defined in respected to the items shown in the financial statements, it is
termed as
a. Accounting ratio
b. Financial ratio
c. Costing ratio
III. Ratio Analysis is not helpful in identifying weak spots of the business.
a. I, II and IV
b. I, III and IV
c. I, II and III
I. Ratio analysis may result in false results if variations in price levels are not considered.
a. I, II and IV
b. I, III and IV
c. I, II and III
c. Overall efficiency of the external market, working efficiency of the internal management
9. While calculating Earnings per share, if both equity and preference share capitals are there, then
c. Both a and b
Cash 10000
Inventory 80000
a. 1.0 : 1
b. 2.0 : 1
c. 2.1 : 1
d. 1.1 : 1
ANSWERS:
1. A
2. B
3. C
4. A
5. A
6. A
7. A
8. B
9. A
10. C