015. Which of the following statements is incorrect? ) Ratios are fractions expressed in percent of times per year. b) A ratio can be computed from any pair of numbers c) A very long list of meaningful rution can be derived OD There is one standard list of ratios Comparison of statement of comprehensive income and statement of financial position numbers, in the form of ratios, should not be done. Q16. A figure from this year's statement is compared with a base selected from the current year Vertical common-size statement b) Horizontal common-size statement e) Funds statement d) Absolute figures e) Statement of financial position QI7. Barclays Bank Ghana has income of GHs 1,000,000. Standard Chartered Bank has income of GHs 2,000,000. Which of the following statements is a correct statement? a) Standard Chartered Bank is getting a higher return on assets employed b) Standard Chartered Bank has higher profit margins than does Barclays Bank Ghana Barclays Bank Ghana could be more profitable than Standard Chartered Bank in relation to resource employed d) No comparison can be made between Barclays Bank Ghana and Standard Chartered Bank e) Barclays Bank Ghana is not making good use of its resources Q18. Industry ratios should not be considered as absolute norms for a given industry because of all but which of the following? a) The firms have different accounting methods b) Many companies have varied product lines c) Companies within the same industry may differ in their method of operations d) The fiscal year-ends of a company may differ The financial services may be private independent firms Q19. Which analysis compares each amount with a base amount for a selected base year? a) Vertical common-size Horizontal common-size c) Funds statement d) Common-size statement e) None of these Q20. Suppose you are comparing two firms in the coal industry. Which type of numbers would be most meaningful for statement analysis? Relative numbers would be most meaningful for both firms, especially for interfirm b) Relative numbers are not meaningful e) Absolute numbers are not relevant d) It is not meaningful to compare two firms e) None of the above 021. Management is a user of financial analysis. Which of the following comments does not represent a fair statement as to the management perspective? Management is not interested in the view of investors Management is interested in liquidity c) Management is interested in profitability d) Management is interested in the financial structure of the entity e) Management is interested in activity ratios Q22. Which of the following ratios can be used as a guide to a firm's ability to carry debt from an income perspective? a) Debt ratio b) Debt to tangible net worth c) Debt/equity Times interest earned e) Current ratio Q23. There is disagreement on all but which of the following items as to whether it should considered a liability in the debt ratio? a) Short-term liabilities b) Reserve account c) Deferred taxes d) Minority shareholders' interest Preferred stock Q24. In computing the debt ratio, which of the following is subtracted in the denomina a) Copyrights b) Trademarks c) Patents d) Marketable securities e) None of the above 6 6
