 | Multiple Choice Question 53 Which one of the following statements about trend analysis is NOT correct? 
| This benchmark is based on a firm's historical performance. |
| The Standard Industrial Classification (SIC) System is used to identify benchmark firms. |
| All of these are true statements. |
| It allows management to examine each ratio over time and determine whether the trend is good or bad for the firm. | Multiple Choice Question 68 | |
Coverage ratios: Sectors, Inc., has an EBIT of $7,221,643 and interest expense of $611,800. Its depreciation for the year is $1,434,500. What is its cash coverage ratio? Multiple Choice Question 68 Multiples analysis: Turner Corp. has debt of $230 million and generated a net income of $121 million in the last fiscal year. In attempting to determine the total value of the firm, an investor identified a similar firm in Jacobs, Inc., an all-equity firm. This firm had 150 million shares outstanding, a share price of $14.25, and net income of $182 million. What is the total value of Turner Corp.? Round to the nearest million dollars.
| $1,715 million |
| $1,651 million |
| $1,191 million |
| $1,421 million |
Multiple Choice Question 46 Coverage ratios, like times interest earned and cash coverage ratio, allow
| a firm's creditors to assess how well the firm will meet its interest obligations. |
| a firm's creditors to assess how well the firm will meet its short-term liabilities other than interest expense. |
| a firm's management to assess how well they meet short-term liabilities. |
| a firm's shareholders to assess how well the firm will meet its short-term liabilities. |
| Multiple Choice Question 54 | |
Peer group analysis can be performed by [removed] | a) management choosing a set of firms that are similar in size or sales, or who compete in the same market. |
[removed] | b) using the average ratios of this peer group, which would then be used as the benchmark. |
[removed] | c) identifying firms in the same industry that are grouped by size, sales, and product lines, in order to establish benchmark ratios. |
[removed] | d) Only a and b relate to peer group analysis. |
| Multiple Choice Question 61 | |
Efficiency ratio: If Viera, Inc., has an accounts receivable turnover of 3.9 times and net sales of $3,436,812, what is its level of receivables? |
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