An analyst has gathered the following information about a company’s capital assets:As

An analyst has calculated the following ratios for a company:

The company’s return on equity (ROE) is closestto:

A.4.8%.

B.15.2%.

C.22.7%.

cash outflow is a firm has:

A.financed its payables.

B.securitized receivables.

C.repurchased stock to offset dilution.

isclosures of three competing companies:

Based on this information, which company is depreciating its building over the longest average period？

A. Company X.

B. Company Y.

C. Company Z.

over the past year and suspects accounting manipulation of cash flows. The least likely way for the company to have decreased its cash conversion cycle is by:

A.financing payables.

B.stretching out payables.

C.securitization of receivables.

year and also has significant number of operating leases. Which of the following statement is the least accurate？

A. The company’s financial statements must be adjusted before the analyst compares this company to other companies in its industry.

B. Despite the off-balance sheet nature of take-or-pay contracts and operating leases, an attempt to determine the actual financial position of the company can be garnered from the footnotes.

C. The take-or-pay contracts and operating leases mean that this company has much higher business risk than similar companies that do not use off-balance sheet financing techniques.

losures of three competing companies:

Based on this information, which company is depreciating its building over the longest average period？

A.Company X.

B.Company Y.

C.Company Z.

Given the following information about a company:

What is the most appropriate conclusion an analyst can make about the solvency of the company？ Solvency has:

A.improved because the debt-to-equity ratio decreased.

B.deteriorated because the debt-to-equity ratio increased.

C.improved because the fixed charge coverage ratio increased.

AAP when he states that:

A. A permanent difference arises from undistributed earnings of an affiliate.

B. A temporary difference arises due to interest received from an investment in tax-exempt municipal bonds.

C. A temporary difference results from the use of straight-line depreciation for book purposes and an accelerated method for tax purposes.

ese costs were fully deductible immediately for tax purposes, but the company is depreciating them over two years for financial reporting purposes.The company has a long history of profitability.When calculating the company’s debt-to-equity ratio, the most appropriate way for an analyst to incorporate the differential tax treatment is to:

A.include it in equity.

B.include it in liabilities.

C.not include it in either equity or liabilities.

Lazlo Ltd, a European-based telecommunications providers, follows IASB GAAP and capitalizes new product development costs. During 2012 they spent €25 million on new product development and reported an amortization expense related to a prior year’s new product development of €10 million. Other information related to 2012 is as follows:

An analyst would like to compare Lazlo to a US-based telecommunications provider and has decided to adjust their financial statements to U.S.GAAP. under U.S.GAAP, and ignoring tax effects, the return on asset (ROA) and cash flow from operations (CFO) for Lazlo would be closestto: