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Exercise 13-1 Building blocks of analysis LO C1 For each ratio, select the building block of financial statement analysis to
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Answer #1
1 Equity ratio = Solvency
2 Return on total assets = Profitability
3 Dividend yield = Market prospect
4 Book value per common share = Profitability
5 Day's sales in Inventory = Liquidity / Efficiency
6 Accounts receivable turnover = Liquidity / Efficiency
7 Debt - to - equity ratio = Solvency
8 Times interest earned = Solvency
9 Gross margin ratio = Profitability
10 Acid - test ratio = Liquidity / Efficiency
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