Question

Question 1

Comparing the operating profit against total assets is often referred to return on assets (ROA). Which of the following categories does ROA help evaluate?

Select one:

a. liquidity

b. leverage

c. revenue

d. profitability

Question 3

Which of the following items would not be found on a balance sheet?

Select one:

a. Retained Earnings

b. Property, plant and equipment

c. Contributed Capital

d. Cash paid to suppliers

Question 4

Not yet answered

Which of the following groups would likely be interested in the financial statements of a large public company?

Select one:

a. Shareholders

b. Competitors

c. Taxing agencies

d. All of the above

Expenses are included in which of the following financial statements?

Select one:

a. Income statement

b. Cash flow statement

c. Balance sheet

d. Chequing account

Answer 1

Answers

All working and explanations form part of the answer

• Question 1

Comparing the operating profit against total assets is often referred to return on assets (ROA). Which of the following categories does ROA help evaluate?

--Correct Answer: Option d. profitability

--This is because Net Income is compared in relation to Total Assets and tells how much Net Income $1 of Asset generates.

• Question 3

Which of the following items would not be found on a balance sheet?

--Correct Answer Option d. Cash paid to suppliers

--This is already included in Cash Account. The same will be shown on the Statement of Cash Flows, not on Balance Sheet.

• Question 4

Which of the following groups would likely be interested in the financial statements of a large public company?

--Correct Answer: d. All of the above
--Stakeholder’s of large public companies include Shareholders, competitors, Taxing agencies, Banks, etc.

• Expenses are included in which of the following financial statements?

--Correct Answer: Option a. Income statement

b. Cash flow statement = shows inflow and outflow of Cash

c. Balance sheet = shows items of Assets, Liability and Equity

d. Chequing account = shows transaction through the account and its not a financial statement