1. Which of the following is correct?

A. The dividend yield ratio measures the return on a stock investment from dividends. It is calculated by dividing dividends per share by market price per share. B. The return on equity measures managements performance by dividing net income by average stockholders equity. It is used to evaluate companies and even to determine top executives compensation. C. The price/earnings (P/E) ratio, measures investors confidence in a companys future. It is calculated by dividing the market price per share by the earnings per share. D. a, b, and c are correct. E. None of the above are correct.

2. Which of the following is required for full disclosure regarding debt structure within the financial statements?

A. Report current liabilities on the balance sheet at fair value. B. Include additional explanation in the notes to the financial statements. C. The disclosure of an unused line of credit helps in assessing a companys borrowing power. D. All of the above are required.