Accounting Quiz
Terms
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- Dividend Payout Ratio
- Dividends ---------- Net Income
- Find Dividend Payout Ratio
- 1. Find Div from Statement of RE 2. Div/Net Income
- Operating Income
- Net Income + Income Tax +Interest Expense
- Cash from Customers
- Beginning AR + Sales -Collections ---------------- Ending AR
- Return on Equity (ROE)
- Net Income ----------- Avg Shareholders Equity
- Measures of Financial Leverage
- Debt Debt ------ OR -------- Equity Assets
- Return on Sales
- Net Income ----------- Sales
- Inventory Turnover
- COGS ------------ Inventory
- Magnitude of Exposure to Bad Debts
- Bad Debt as % of Sales Bad Debt as % of Receivables
- Bad Debt as % of Sales
- Change in Allowances (Provision, what is on Allowance and RE) -------------------- Revenues
- Bad Debt as % of Receivables
- Ending Allowance ------------------ Ending AR (including allowance) (above the line, on the asset side)
- Collection Period of Receivables or Days Sales Outstanding
- Net Accounts Receivable ------------------ 4th qtr sales/90 OR Sales/360
- Under GAAP, when should revenue be recognized?
- -exchange transaction has taken place -earnings process is virtually complete -collectibility of cash is reasonably assured or predictable
- Cash Paid for Wages
- Accrued Payroll (t-1) + Expense(t) - Cash Paid (t) = Accrued Payroll (t)
- Explain Change in Retained Earnings (Accumulated Deficit)
- Accumulated Deficit (t-1) + Net Income/Loss (t) - Dividends (t) = Accumulated Deficit (t)
- Goodwill
- -only arises during an acquisition -stays on balance sheet until company is sold (does not amortize) -represents the excess of the purchase price over the total assets