Chapter 12
Financial Statement Analysis
Multiple Choice
1. (LO 1—Financial statement analysis)
2. (LO 1—Limitations of financial statement analysis)
3. (LO 2—Horizontal analysis)
4. (LO 2—Trend analysis)
5. (LO 3—Vertical analysis: Calculation of working capital)
6. (LO 4—Liquidity ratio: Calculation of asset turnover)
Solutions to Multiple Choice
MC12–2
7. (LO 4—Liquidity ratio: Calculation of current ratio)
8. (LO 4—Liquidity ratio: Calculation of acid-test ratio)
9. (LO 5—Solvency ratio: Calculation of debt-to-equity)
10. (LO 6—Profitability ratio: Calculation of return on common stockholders’
equity)