91. Which of the following statements about financial statement analysis is incorrect?
A. In horizontal percentage analysis, an item from the financial statements is expressed as a percentage of the same item from a previous year's financial statements.
B. Vertical analysis compares two or more financial statement items within the same time period.
C. Horizontal analysis for several years can be done by choosing one year as a base year and calculating increases or decreases in relation to that year.
D. The reason behind a financial statement ratio or percentage analysis result is usually self-evident and does not require further study or analysis.
92. Which of the following statements is correct?
A. The most widely quoted measure of a company's earnings performance is return on equity.
B. Earnings per share is calculated for a company's preferred stock.
C. Investors need to understand that the value of a company's earnings per share is affected by its choices of accounting principles and assumptions.
D. The book value per share measures the market value of a corporation's stock.
93. Which of the following statements about specific ratios is incorrect?
A. The net margin ratio is a profitability ratio.
B. The current ratio is a liquidity ratio.
C. The debt to assets ratio is a liquidity ratio.
D. The dividend yield is a stock market ratio.
94. Which of the following is
notincluded in the computation of the quick ratio?
A. prepaid expenses
B. cash
C. accounts receivable
D. marketable securities
95. Which ratio compares the earnings per share of a company to the market price for a share of the company’s stock?
A. Return on equity
B. Price-earnings ratio
C. Book value per share
D. Dividend yield
96. Garrett Corporation had sales of $6,000,000, cost of sales of $4,200,000, and average inventory of $900,000. Garrett’s inventory turnover ratio for the period is closest to:
A. 4.7 times
B. 2.0 times
C. 6.7 times
D. .15 times