Financial Statement Review and Analysis Flashcards

1
Q

A proportional analysis of a financial statement where each account balance is compared against a base number in the same financial statement

A

Vertical Analysis

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2
Q

A report that compares financial statements over multiple accounting periods

A

Comparative Statement

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3
Q

Ratios used to measure a company’s ability to generate profit relative to its revenue

A

Profitability Ratios

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4
Q

The profitability ratio used to measure net income relative to total revenue, also called “net margin”

A

Net Profit Margin

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5
Q

A profitability ratio used to measure total expenses relative to total revenue

A

Expense Ratio

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6
Q

a standard by which financial metrics can be compared

A

Benchmark

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7
Q

The act of borrowing money to purchase assets

A

Leverage

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8
Q

An organizations ability to meet its financial obligations owed creditors

A

Solvency

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9
Q

A ratio used to measure a company’s degree of leverage

A

Leverage Ratio

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10
Q

the leverage ratio used to measure total liabilities relative to total assets

A

Debt Ratio

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11
Q

A time based analysis of financial statements or financial Ratios across multiple accounting periods, often called trend analysis

A

Horizontal Analysis

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