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3 years ago

Based on the following information from ABC Company's financial analysis, which one of the following statements is NOT true?

Business

1 answer:

Vlada [557]3 years ago

5 0

Answer:

ABC Company

Financial Analysis:

A. The cost of goods sold has been increasing over the five years.

Explanation:

The gross profit ratio was 58.3% in year 1 and continued a downward spiral to 41.3% in year 5. This depicted an underlying fact that the cost of goods sold had been increasing over the years. The cost of goods sold influences the gross profit, and with the sales value remaining stable over the years, the ability of the company to generate enough profit out of its sales had been impaired greatly. Fortunately, for ABC Company, the increasing cost of goods sold did not increase alongside the fixed costs of running the business. This resulted to an increasing net profit ratio over the same period.

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Cook, Inc., a manufacturer of tires, has given you its most recent annual report in an effort to obtain a sizable loan. The comp

Tcecarenko [31]

Answer:

a. Relevant

Explanation:

The documentary on prime time television that brought awareness to Cook Inc... being defendant in several lawsuits relating to it's defective tyres that has caused vehicles to overturn is a financial information that is relevant.

As a financial analyst, being presented with such information is very relevant and it makes me to consider it as a factor before issuing loan to the organization and also help to garner what the public'e perception of the company stock will be. In addition, the information will help to make predictions about future directions of the company's stock price and, evaluate the company's financial health and earnings potential to be able to pay back the loan if given the loan.

6 0

3 years ago

During your investigation you found the effective dates on stock options were deliberately changed for the purpose of securing e

Kitty [74]

Backdating is when the effective dates on stock options were deliberately changed for the purpose of securing extra pay for management.

Backdating is the practice of amending the date of a contract, a legal document, or a cheque to a preceding date. changing the date on this sort of record to misrepresent any data makes this practice unlawful in some cases.

Backdating is the practice of marking a cheque, settlement, or other legally binding settlement with a date this is prior to the contemporary date. Backdating is typically no longer allowed and even can be illegal or fraudulent in a few conditions.

And public organizations responsible for backdating may additionally violate federal securities disclosure and reporting necessities, exposing themselves to regulatory or criminal investigations as well as securities fraud litigation. If you decide to award backdated stock options, touch us about a way to do it in the right manner.

Learn more about contract here brainly.com/question/5746834

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3 0

1 year ago

In economics, another term for satisfaction is marginal productivity. income elasticity. utility. price elasticity.

Feliz [49]

Answer:

Utility

Explanation:

Utility is an economic term used to represent satisfaction or happiness. Marginal utility is the incremental increase in utility that results from consumption of one additional unit.

3 0

3 years ago

Price and Output data over a five year period for an economy that produces only one good. Assume that year 2 is the base year. Y

olasank [31]

Answer:

$90

Explanation:

Nominal GDP is GDP calculated using current year prices.

Nominal GDP = current year prices x unit of output

18 x $5 = $90

Gross domestic product is the total sum of final goods and services produced in an economy within a given period which is usually a year

7 0

3 years ago

When is a goodwill impairment loss recognized? a. Annually on a systematic and rational basis. b. Never When both the fair value

gulaghasi [49]

Answer:

The correct answer is letter "C": When both the fair value of a reporting unit and its associated implied goodwill fall below their respective carrying values.

Explanation:

Impairment Loss is the decrease in an asset's net carrying value that exceeds the future undisclosed cash flow it should generate. The net carrying value is an asset's acquisition cost minus depreciation. Impairment occurs when a company sells or abandons an asset that is no longer beneficial.

Thus, <em>a goodwill impairment loss is recognized when the goodwill's net carrying value is below its fair value and the expected cash flow it was to generate.</em>

7 0

3 years ago