18 Which of the following metrics will not be part of a firm's historical income statements as presented in Form 10-K?

A.Operating Profit

B.Gross Profit

C.SG&A

D.EBITDA

25 Which of the following is false with respect to the Statement of Cash Flows?

A.Noncash expenses, like depreciation and amortization expenses, as well as, nonoperating losses are added back to net income to arrive at cash flows from operating activities.

B.Cash flows from operating activities convert the company's net income to cash by adjusting earnings for noncash expenses, nonoperating gains/losses, and accruals taken on operating items from the balance sheet.

C.Decreases in accounts receivables, decreases in inventories, and increases in payables will all result in cash inflows from operations.

D.Increases in accounts receivables, increases in inventories and increases in accounts payables all generate cash inflows for the period.

38 Which of the following is not an operating item on the Income Statement?

A.Interest Expense

B.Research and Development

C.Cost of Goods Sold

D.Revenues

41 Which of the following is false with respect to the Statement of Cash Flows?

A.Share repurchases and dividend payments will create cash outflows for financing activities.

B.Cash outflows from investing activities typically revolve around spending for capex and the payment of debt.

C.Investing activities include expenditures for property, plant and equipment (capex), expenditures for intangible assets, and cash flows from security investment activities.

D.Financing activities include fund flows related to stock issuances, debt, share repurchases, and dividend payments.

42 Which of the following does not factor in to the calculation of cash flows from operating activities under the indirect method?

A.The loss on the sale of the equipment.

B.A decrease in the balance of accounts receivable.

C.Depreciation expense.

D.The total proceeds from the sale of equipment.

E.Share-based compensation expense.

44 Which is true when reading financial statements?

A.Statement of Cash Flows amounts represent cash inflows and outflows for the current reporting period.

B.Statement of Shareholders' Equity amounts represent cash balances at the end of the reporting period.

C.Income Statement amounts represent revenue and expense changes from the prior period.

D.Balance Sheet amounts represent asset, liability and owner equity changes for the reporting period.

52 What is usually presented first in the notes to the financial statements?

A.Commitments and Contingencies

B.Significant Accounting Policies

C.Earnings Per Share Calculations

D.Accumulated Comprehensive Income

54 What is a common-size income statement?

A.A statement that expresses each item on the income statement as a percentage of total assets.

B.An income statement that groups all items of revenue together, then deducts all categories of expenses.

C.An income statement that provides intermediate profit measures.

D.A statement that expresses each item on the income statement as a percentage of net sales or revenues.

55 Which of the following will appear as a positive amount on a statement of cash flows that was prepared using the indirect method?

A.An increase in accounts receivable

B.A decrease in accounts payables

C.Depreciation expense

D.An increase in inventories