Quiz Ch 12 – T/F Relationship between Net Income and Dividends for Stockholders
Financial Accounting
Thomas, Tietz, and Harrison
12th Edition
Stockholders are more likely to receive dividends if the net income is higher.
Stockholders are more likely to receive dividends if the net income is higher.
Conservative recognition of net revenues is a crucial factor in determining earnings quality.
Financial analysis requires more than basic arithmetic and examining financial statements.
Gaining knowledge about the industry, market, economic conditions, product development trends, and company strategies provides a context to a company’s financial figures and aids in comprehending the reasons behind the outcomes.
The income statement initiates the annual report filing of every public company.
Vertical analysis is a useful tool for comparing companies of different sizes.
Consistent growth in income from operations signifies revenue expansion, but potentially uncontrolled expenses, indicating future growth and increased company value.
The Management’s Discussion and Analysis section of the annual report contains the management’s rationale for fluctuations in sales.
If a company’s net income is 15% of sales, then according to vertical analysis, the cost of goods sold must be 85% of sales.
Among the options, which one will result in an increase in net working capital, assuming all other factors remain unchanged?