Investments & Securities Chapter 19 which of the following would best explain a

40.

Ferris Corp. wants to increase its current ratio from the present level of 1.5 when it closes

the books next week. The action of __________ will have the desired effect.

41.

Assuming continued inflation, a firm that uses LIFO will tend to have a(n) ________current

ratio than a firm using FIFO, and the difference will tend to __________ as time passes.

42.

Fundamental analysis uses

43.

__________ is a true statement.

44.

__________ is a false statement.

45.

The level of real income of a firm can be distorted by the reporting of depreciation and

interest expense. During periods of high inflation, the level of reported depreciation tends

to __________ income, and the level of interest expense reported tends to __________

income.

46.

Which of the following would best explain a situation where the ratio of net income/total

equity of a firm is higher than the industry average, while the ratio of net income/total

assets is lower than the industry average?

47.

What best explains why a firm’s ratio of long-term debt/total capital is lower than the

industry average, while the ratio of income before interest and taxes/debt interest charges

is lower than the industry average?

48.

__________ best explains a ratio of sales/average net fixed assets that exceeds the

industry average.

49.

Comparability problems arise because

50.

One problem with comparing financial ratios prepared by different reporting agencies is