Financial Statement Analysis Coursera Quiz Answers

Get Financial Statement Analysis Coursera Quiz Answers

In the final course of this certificate, you will apply your skills towards financial statement analysis. If you have the foundational concepts of accounting under your belt, you are ready to put them into action in this course. Here, you will learn how to reconcile different types of accounts, check for accuracy, and troubleshoot errors.

Additionally, you will practice how to apply different analytical methods to key financial statements and understand how these methods inform a variety of business decisions.

By the end of this course, you will be able to: -Describe and illustrate the use of a bank reconciliation in controlling cash -Outline the purpose of financial statements in relationship to decision making -Describe basic financial statement analytical methods -Apply quantitative skills to analyze business health Courses 1-3 in the Intuit Bookkeeping Professional Certificate, or the equivalent, are recommended prerequisites for this course.

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Financial Statement Analysis Week 01 Quiz Answers

Reconciliation Types and Processes Practice Quiz

Q1. If your account balances don’t match at the end of the month, which of the following steps should you take to find the error? Select all that apply.

  • Don’t worry about it. Books have a way of balancing out over time
  • Check for transposition errors (number amounts being flip flopped)
  • Go line by line comparing ledger entries with the external account statement
  • Check the balance difference and cross-reference for missing transactions of that amount

Q2. If I use the balance sheet approach for reconciling the books each month, all of the following accounts would be reconciled except:

  • Inventory
  • Accounts Payable
  • Bank Statement
  • Cash

Q3. The reconciliation process can help with the following except:

  • Ensuring the business is profitable
  • Ensure account balances are accurate
  • Ensuring all transactions are accounted for
  • Ensure any fraudulent activities are more easily detected

Q4. True or False: The month-end close-out process for certain accounts is considered a type of reconciliation.

  • True
  • False

Reconciliation Source Documentation Types Practice Quiz

Q1. The original records that prove a specific transaction took place are referred to as:

  • Original Documents
  • Source Records
  • Original records
  • Source Documents

Q2. Which of the following is considered a source document?

  • Invoices
  • Bank Statement
  • Every other option.
  • Receipt

Q3. Which of the following is not considered an element of a source document?

  • Company Logo
  • Date of the Transaction
  • Reference Number
  • Description of the Transaction

Report Reconciliations vs Transactional Reconciliations Practice Quiz

Q1. Which of the following best describes the Transactional Method of Reconciliation?

  • The method of using credits and debits to record transactions
  • The method of reviewing existing transactions and source documents to confirm the amount was spent
  • The method of comparing the amount listed on a source document to the actual ending balance listed on the balance sheet
  • The method of determining the amount that can be written off for an asset over time

Q2. Which of the following best describes the Report Method of Reconciliation?

  • The method of comparing the amount listed on a source document to the actual ending balance listed on the balance sheet
  • The method of determining if the books are balanced by using the equation Assets = Liabilities + Equity
  • The method of reviewing existing transactions and source documents to confirm the amount was spent
  • The method of determining the equity that an owner or shareholder currently has within the company

Q3. Which of the following accounts can be reconciled using the report reconciliation method? (select all that apply)

  • Cash Account
  • Accounts Payable
  • Payroll
  • Long Term Note

Quiz : Understanding Reconciliations Assessment

Q1. True or False: Reconciliation is the process by which a business verifies its books with external account statements or data to ensure they match and reflect accurate business dealings.

  • False
  • True

Q2. Stan is in the process of performing a month-end close-out for his business, Lock ‘n Key. He noticed that his cash account indicates a difference of $25 from his bank statement. The following are strategies he can use to reconcile his books, except:

  • Check for any uncleared checks
  • Check for any service fees the bank may have charged
  • Stan can withdraw $25 from his bank, and that will balance out his books
  • Perform a line-by-line review of transactions in his general ledger with the bank statement

Q3. The following are examples of source documents except:

  • Invoices
  • Bank Statements
  • Post-it Note
  • Credit Memos

Q4. The following are pros of using the Report Review Method for Reconciliation, except:

  • It can highlight problem accounts to focus on
  • It can be a faster process than other methods
  • It can give insight into the business health and trends for certain accounts
  • It provides a detailed level review

Q5. Which of the following accounts can be reconciled using the report reconciliation method? (Select all that apply)

  • Payroll
  • Accounts Payable
  • Long Term Note
  • Cash Account

Q6. True or False: As long as the items are legible and contain all of the original information, in most cases, a photocopy or digital copy of a source document is deemed acceptable.

  • False
  • True

Q7. Zapata is preparing her annual taxes for her retail clothing business, La Calidad. She has been performing quarterly reconciliations of her accounts and is about to do her final quarterly review. She begins with an analytical review, and then, digs deeper if a discrepancy is noted. Review the source documents and statements below to answer the questions.

Compare the two documents below to reconcile the bank account. Then, determine which of the following are errors. (Select all that apply)

  • The balance totaled on 10/27 and 11/01 is incorrect
  • The charge on 12/21 was transposed incorrectly
  • The bank omitted the check deposit on 11/14
  • The ledger omitted the bank tax on 12/10

Q8. Zapata is preparing her annual taxes for her retail clothing business, La Calidad. She has been performing quarterly reconciliations of all her accounts and is about to do her final quarterly review. She begins with an analytical review and then digs deeper if a discrepancy is noted. Review the source documents and statements below to answer the questions.

What additional source documents might Zapata need to complete this reconciliation? (Select all that apply)

  • Bank fees schedule or policy
  • Report of checks written but not yet cleared
  • Checkbook ledger
  • Credit card statement

Q9. Zapata is preparing her annual taxes for her retail clothing business, La Calidad. She has been performing quarterly reconciliations of all her accounts and is about to do her final quarterly review. She begins with an analytical review and then digs deeper if a discrepancy is noted. Review the source documents and statements below to answer the questions.

Which type of error occurred for the entry on 12/21/20?

  • Addition
  • Reversal
  • Transpositional
  • Omission

Q10. Zapata is preparing her annual taxes for her retail clothing business, La Calidad. She has been performing quarterly reconciliations of all her accounts and is about to do her final quarterly review. She begins with an analytical review and then digs deeper if a discrepancy is noted. Review the source documents and statements below to answer the questions.

What might be a strategy Zapata could use to prevent this from occurring again in the future? (Select all that apply)

  • Make sure she is closing out and reconciling all her accounts each month
  • Use a software tool, like QuickBooks Online, to minimize human errors
  • Use estimates to close out her books each month, then perform an annual transactional account reconciliation at the end of the year
  • Perform a balance sheet approach reconciliation each month

Q11. Sassafras Day Spa and Salon is closing its books and preparing a bank reconciliation for the following items:

  • Bank statement contains an ending balance of $300,000 as of April 30th, 2019, whereas because some items were missing the balance on the books is $260,900.
  • Bank statement contains a $100 service charge for operating the account
  • Bank statement contains an interest income of $20
  • Sassafras Day Spa issued Checks of $50,000 that have not yet been cleared by the bank
  • Sassafras Day Spa deposited $20,000, but this did not appear on the bank statement
  • A check for the amount of $470 issued to the office supplier was misreported in the cash payments journal as $370
  • A note receivable of $9800 was collected by the bank
  • A check of $520 deposited by Sassafras has been charged back as NSF

What is the amount that should be put in space J? (format your answer as xxxxxx-no decimals, commas, or $ signs)

Q12. Sassafras Day Spa and Salon is closing its books and preparing a bank reconciliation for the following items:

  • Bank statement contains an ending balance of $300,000 as of April 30th, 2019, whereas because some items were missing the balance on the books is $260,900.
  • Bank statement contains a $100 service charge for operating the account
  • Bank statement contains an interest income of $20
  • Sassafras Day Spa issued Checks of $50,000 that have not yet been cleared by the bank
  • Sassafras Day Spa deposited $20,000, but this did not appear on the bank statement
  • A check for the amount of $470 issued to the office supplier was misreported in the cash payments journal as $370
  • A note receivable of $9800 was collected by the bank
  • A check of $520 deposited by Sassafras has been charged back as NSF

What is the difference being reconciled between the ending balance of the bank statement and the ending balance recorded on the books for April 30th, 2019? (format your answer as xxxxxx-no decimals, commas, or $ signs)

Q13. Sassafras Day Spa and Salon is closing its books and preparing a bank reconciliation for the following items:

  • Bank statement contains an ending balance of $300,000 as of April 30th, 2019, whereas because some items were missing the balance on the books is $260,900.
  • Bank statement contains a $100 service charge for operating the account
  • Bank statement contains an interest income of $20
  • Sassafras Day Spa issued Checks of $50,000 that have not yet been cleared by the bank
  • Sassafras Day Spa deposited $20,000, but this did not appear on the bank statement
  • A check for the amount of $470 issued to the office supplier was misreported in the cash payments journal as $370
  • A note receivable of $9800 was collected by the bank
  • A check of $520 deposited by Sassafras has been charged back as NSF

What is the amount that should be listed on line L? (format your answer as xxxxxx-no decimals, commas, or $ signs)

Q14. Sassafras Day Spa and Salon is closing its books and preparing a bank reconciliation for the following items:

  • Bank statement contains an ending balance of $300,000 as of April 30th, 2019, whereas because some items were missing the balance on the books is $260,900.
  • Bank statement contains a $100 service charge for operating the account
  • Bank statement contains an interest income of $20
  • Sassafras Day Spa issued Checks of $50,000 that have not yet been cleared by the bank
  • Sassafras Day Spa deposited $20,000, but this did not appear on the bank statement
  • A check for the amount of $470 issued to the office supplier was misreported in the cash payments journal as $370
  • A note receivable of $9800 was collected by the bank
  • A check of $520 deposited by Sassafras has been charged back as NSF

What amount goes on line B? (format your answer as xxxxxx-no decimals, commas, or $ signs)

Q15.

Sassafras Day Spa and Salon is closing its books and preparing a bank reconciliation for the following items:

  • Bank statement contains an ending balance of $300,000 as of April 30th, 2019, whereas because some items were missing the balance on the books is $260,900.
  • Bank statement contains a $100 service charge for operating the account
  • Bank statement contains an interest income of $20
  • Sassafras Day Spa issued Checks of $50,000 that have not yet been cleared by the bank
  • Sassafras Day Spa deposited $20,000, but this did not appear on the bank statement
  • A check for the amount of $470 issued to the office supplier was misreported in the cash payments journal as $370
  • A note receivable of $9800 was collected by the bank
  • A check of $520 deposited by Sassafras has been charged back as NSF

Which of the following amounts is the correct amount for Line I?

  • $320,900
  • $270,720
  • $320,000
  • $260,900

Q16.

Sassafras Day Spa and Salon is closing its books and preparing a bank reconciliation for the following items:

  • Bank statement contains an ending balance of $300,000 as of April 30th, 2019, whereas because some items were missing the balance on the books is $260,900.
  • Bank statement contains a $100 service charge for operating the account
  • Bank statement contains an interest income of $20
  • Sassafras Day Spa issued Checks of $50,000 that have not yet been cleared by the bank
  • Sassafras Day Spa deposited $20,000, but this did not appear on the bank statement
  • A check for the amount of $470 issued to the office supplier was misreported in the cash payments journal as $370
  • A note receivable of $9800 was collected by the bank
  • A check of $520 deposited by Sassafras has been charged back as NSF

Which of the following amounts is the correct amount for line D?

  • $50,000
  • $100
  • $20,000
  • $9,800

Q17. Sassafras Day Spa and Salon is closing its books and preparing a bank reconciliation for the following items:

  • Bank statement contains an ending balance of $300,000 as of April 30th, 2019, whereas because some items were missing the balance on the books is $260,900.
  • Bank statement contains a $100 service charge for operating the account
  • Bank statement contains an interest income of $20
  • Sassafras Day Spa issued Checks of $50,000 that have not yet been cleared by the bank
  • Sassafras Day Spa deposited $20,000, but this did not appear on the bank statement
  • A check for the amount of $470 issued to the office supplier was misreported in the cash payments journal as $370
  • A note receivable of $9800 was collected by the bank
  • A check of $520 deposited by Sassafras has been charged back as NSF

What is the total amount of deductions taken on the balance per the books portion of the reconciliation? (format your answer as xxxxxx-no decimals, commas, or $ signs)

Q18.

Sassafras Day Spa and Salon is closing its books and preparing a bank reconciliation for the following items:

  • Bank statement contains an ending balance of $300,000 as of April 30th, 2019, whereas because some items were missing the balance on the books is $260,900.
  • Bank statement contains a $100 service charge for operating the account
  • Bank statement contains an interest income of $20
  • Sassafras Day Spa issued Checks of $50,000 that have not yet been cleared by the bank
  • Sassafras Day Spa deposited $20,000, but this did not appear on the bank statement
  • A check for the amount of $470 issued to the office supplier was misreported in the cash payments journal as $370
  • A note receivable of $9800 was collected by the bank
  • A check of $520 deposited by Sassafras has been charged back as NSF

What is the correct adjusted cash balance amount that should be listed on lines E and M to reconcile this account?

  • $270,720
  • $310,200
  • $270,000
  • $250,000

Q19. Which of the following best describes the Transactional Method of Reconciliation?

  • The method of comparing the amount listed in the source document to the actual ending balance listed on the balance sheet.
  • The method of determining the amount that can be written off for an asset over time.
  • The method of reviewing existing transactions and source documents to confirm the amount was spent.
  • The method of comparing percent changes in data period over period.

Q20. Which of the following best describes the Report Method of Reconciliation?

  • The method of using the equation A=L+E to determine if the books are balanced.
  • The method of comparing the amount listed in the source document to the actual ending balance listed on the balance sheet.
  • The method of reviewing source documents to prepare for tax returns.
  • The method of writing a bank statement reconciliation to complete an end of month close on the cash account.

Financial Statement Analysis Week 02 Quiz Answers

Income Statement Practice Quiz

Q1. True or False: Horizontal analysis results can be listed as either percentages or dollar amounts.

  • True
  • False

Q2. The following are aspects of the Income Statement except:

  • Gross Revenue
  • Sales, General, and Administrative (SG&A)
  • Net Profit
  • Long-term Liabilities

Q3. True or False: In vertical analysis, the gross sales or revenue is the base amount on a P&L statement.

  • True
  • False

Q4. If Amy’s Aroma’s operating expenses in 2020 were $45,000, and in 2019 they were $37,000, what would the percent change be? (hint, remember the formula: 𝚫% = $recent year – $older year / $older year x 100)

  • 112%
  • 21%
  • 0.21%
  • -21%

Q5. True or False: In vertical analysis, you compare each line item in the financial statement to the base amount as a percentage of that base amount.

  • True
  • False

Interpreting the Balance Sheet Practice Quiz

Q1. Deferred Revenues is an account that is found in:

  • Current Liabilities
  • Noncurrent Liabilities
  • Current Assets
  • Noncurrent Assets

Q2. Short-term Investments is an account that is found in:

  • Noncurrent Assets
  • Current Liabilities
  • Current Assets
  • Noncurrent Liabilities

Q3. Long-term debt securities issued by the company are called:

  • Common Stock
  • Notes Payable
  • Bonds Payable
  • Deferred Revenue

Interpret the Statement of Cash Flows Practice Quiz

Q1. Which section of the Statement of Cash Flows would you look to find cash flows related to inventory?

  • Financing Activities
  • Operating Activities
  • Investing Activities

Q2. Which section of the Statement of Cash Flows would you look to find cash flows related to notes payable?

  • Operating Activities
  • Investing Activities
  • Financing Activities

Q3. Which would be considered deferred revenue?

  • Cash Inflow
  • Cash Outflow

Q4. A line item on the Statement of Cash Flows shows a loan amount of -$2,000. What does this mean?

  • The company is receiving a loan for the amount of $2,000.
  • The company is paying off a loan for the amount of $2,000.

Quiz : Financial Statements Assessment

Q1. If operating expenses in 2020 (recent year) were $55,000 and in 2019 (older year) they were $36,000, what would the percent change be? Hint: remember the formula: (($recent year – $older year) / $older year) x 100 = 𝚫% (enter your answer as a whole number without punctuation)

Q2. Where are Short-term Investments found on the Balance Sheet?

  • Noncurrent Assets
  • Current Liabilities
  • Noncurrent Liabilities
  • Current Assets

Q3. Which section of the Statement of Cash Flow would you look to find cash flows related to inventory?

  • Operating Activities
  • Net Cash
  • Investing Activities
  • Financing Activities

Q4. Long-term Debt Securities issued by the company are called:

  • Guaranteed Payments
  • Bonds Payable
  • Owner’s Draw
  • Common Stock

Q5. The following are aspects of the income statement except:

  • Net Profit
  • Stakeholders Equity
  • Gross Revenue
  • SG&A

Q6. The Net Income on the Cash Flow Statement should match the bottom line on the _________, and the Cash at end of the period should match Cash on the _________.

  • Profit and Loss, Statement of Equity
  • Sales Report, Balance Sheet
  • Balance Sheet, Profit and Loss
  • Income Statement, Balance Sheet

Q7. True or False: Vertical Analysis Results can be listed as percentages and dollar amounts as long as one or the other is consistently used.

  • False
  • True

Q8. A line item on the Statement of Cash Flows shows a loan amount of -$4,000. What does this mean?

  • The company is receiving a loan amount of $4,000
  • The company is paying off a loan amount of $4,000

Q9. Land improvements would be found on which of the following documents?

  • Balance Sheet
  • Shareholder’s Equity
  • Statement of Cash Flows
  • Income Statement

Q10. True or False: In vertical analysis, you compare each line item in the financial statement to a percentage of the base amount.

  • True
  • False

Q11. The Principal Balance of any long-term debt due within a year would go under which account on the Balance Sheet?

  • Other receivables
  • Accounts Receivable
  • Current portion of Long-Term Debt
  • Short Term Loans Payable

Q12. True or False: Horizontal analysis results can be listed as either percentages or dollar amounts.

  • True
  • False

Q13. Where would you locate Deferred Revenues on the Balance Sheet?

  • Current Assets
  • Noncurrent Liabilities
  • Noncurrent Assets
  • Current Liabilities

Q14. True or False: In vertical analysis, the Gross Sales or Revenue is the base amount on a P&L statement.

  • True
  • False

Q15. Sales Tax and Payroll Tax are both considered _______________ and found on the ______________.

  • Deferred Revenue, Statement of Cash flows
  • Investments, Balance Sheet
  • Liabilities, Balance Sheet
  • Assets, Income Statement

Q16. True or False: Deferred Revenue is considered a Cash Inflow.

  • False
  • True

Q17. True or False: On the Statement of Cash Flows, the cash at the end of the period is calculated by adding the net cash increase for that period to the cash at the beginning of the period.

  • False
  • True

Q18. Which of the following is the bottom line on the P&L statement?

  • Gross Revenue
  • Gross Profit
  • Net Profit
  • Net Revenue

Q19. Which section of the Statement of Cash Flows would you look to find cash flows related to Notes Payable?

  • Financing Activities
  • Net Cash
  • Operating Activities
  • Investing Activities

Q20. True or False: On the Statement of Cash Flows, the Cash at the beginning of the period matches the Net Profit on the P&L for that same period.

  • False
  • True

Financial Statement Analysis Week 03 Quiz Answers

Balance Sheet Practice Quiz

Q1. What does the debt to equity ratio evaluate?

  • What proportion of equity a company is using to finance its profits
  • A company’s debt as a percentage of total liabilities and owner’s equity amount
  • What proportion of debt or equity a company is using to finance its assets

Q2. If a company has $30,000 debt and $60,000 equity, what is its debt to equity ratio?

  • 5.0
  • 0.5
  • 0.2
  • 2.0

Q3. Which of the following statements is incorrect?

  • The higher the debt-to-equity ratio, the more profit the company has recorded
  • A high debt-to-equity ratio means the company has a lot of debt in relation to the equity
  • The higher the debt-to-equity ratio, the more debt the company has on its balance sheet
  • The debt-to-equity ratio analyzes the relationship between total liabilities and total equity

Q4. True or False: Generally, a high AP ratio indicates that you satisfy your accounts payable obligations quickly.

  • False
  • True

Business Communications Practice Quiz

Q1. Suppose one of your bookkeeping clients has stated they prefer to have a conversation around their financial statements, not simply receive an email. What communication channels might you use? (select all that apply)

  • Face-to-face meetings
  • Phone calls
  • Webconference
  • Text message

Q2. What does KPI stand for in accounting?

  • Key Partner Information
  • Key Partner Index
  • Key Performance Indicator

Q3. Which of the following would be the best and most professional subject line to use when you want to ensure the client reads and responds to a request?

  • Action Requested: Please Review and Provide Signature
  • READ THIS RIGHT NOW
  • Please sign this and return it by end of business next Wednesday, or I will not be able to move forward
  • Bookkeeping Update

Quiz : Analyzing Key Reports and Transactions Assessment

Q1. Gross Profit Margin shows the percentage of revenue that:

  • Exceeds the cost of goods sold (COGS)
  • The percentage of profit a company produces from its total revenue
  • How much profit a company makes on a dollar after paying for expenses and overhead

Q2. Lou’s Tavern recorded $60,000 in sales revenue and a cost of goods sold of $45,000 on their income statement this month. What is their Gross Profit Margin? (enter your answer as a decimal and round to the nearest hundredth, example x.xx)

Q3. Net profit margin shows the percentage of:

  • Revenue that exceeds the cost of goods sold (COGS)
  • Profit a company produces from its total revenue
  • Profit a company makes on a dollar after paying for expenses and overhead

Q4. On Marla’s Laundromat Income Statement there is a Sales Revenue of $60,000 and Operating Earnings of $11,000. What is their Operating Profit Margin? (enter your answer as a decimal and round to the nearest hundredth, example x.xx)

Q5. Tyler’s Theater recorded a net profit of $8,500 in addition to their Sales Revenue of $60,000 on their recent income statement. What is their Net Profit Margin? (enter your answer as a decimal and round to the nearest hundredth, example x.xx)

Q6. Using the following balance sheet, calculate the Current Ratio.

  • 8.38
  • 16.11
  • 11.5
  • 3.37

Q7. What does the debt to equity ratio evaluate?

  • What proportion of debt or equity a company is using to finance its assets
  • A company’s debt as a percentage of total liabilities and owner’s equity amount
  • What proportion of equity a company is using to finance its profits

Q8. If a company has $30,000 debt and $60,000 equity, what is its debt to equity ratio? (enter your answer as a decimal and round to the nearest tenth, example x.x)

Q9. When is a high debt to equity ratio be positive for a company’s financial health and share price?

  • If the company does not borrow any money
  • If the earnings growth that the borrowed money generates is LOWER than the cost of borrowing it
  • If the earnings growth that the borrowed money generates is HIGHER than the cost of borrowing it

Q10. Which of the following statements is incorrect?

  • The debt-to-equity ratio analyzes the relationship between total liabilities and total equity
  • The higher the debt-to-equity ratio, the more debt the company has on its balance sheet
  • The higher the debt-to-equity ratio, the more profit the company has recorded
  • A high debt-to-equity ratio means the company has a lot of debt in relation to equity

Q11. True or False: Generally, a high AP turnover ratio indicates that you satisfy your accounts payable obligations quickly.

  • True
  • False

Q12. The Cash Flow Coverage Ratio measures _________.

  • how well a company converts sales to cash
  • a company’s ability to pay its short-term obligations
  • company solvency
  • how well a company can pay its expenses

Q13. The cash flow margin ratio demonstrates _________.

  • a company’s ability to pay its short-term obligations
  • how well a company converts sales to cash
  • how well a company produces cash from its total revenue
  • company solvency

Q14. DigiWidgit recorded operating cash flows totaling $152,000 and the total debt payable for the year was $77,000 What is their Cash Flow Coverage Ratio? (enter your answer as a decimal and round to the nearest hundredth, example x.xx)

Q15. Daryl’s Delivery recorded current liabilities of $44,000 at the year’s start, current liabilities of $67,000 at year’s end, and Cash Flow from Operating Activities of $120,000. What is their Current Liability Coverage Ratio? (enter your answer as a decimal and round to the nearest hundredth, example x.xx)

Q16. Superior Suits recorded a cash flow from operations of $48,750 and net sales of $87,000. What is their Operating Cash Flow Margin ratio? (enter your answer as a decimal and round to the nearest hundredth, example x.xx)

Financial Statement Analysis Week 04 Quiz Answers

Reconciliations Practice Quiz

Q1. Which of the following are types of source documents that might be needed to perform a vendor account reconciliation?

  • Invoices
  • Credit Card Statement
  • Bank Statement
  • Order Reciept

Q2. The following are types of common errors except:

  • Error of Original Entry
  • Error of Omission
  • Error of Commission
  • Error of Law

Q3. True or False: All accounts can be reconciled.

  • False
  • True

Workflow Practice Quiz

Q1. Upon reviewing the financial statements, you have determined that the sales revenue listed on the financial statements is incorrect and should actually be $15,000 instead of $5,000. Assuming all other accounts are accurate, what would the new net income be? (enter your answer as a whole number and don’t use punctuation, example $7,800 would be 7800)

Q2. After reviewing and revising the income statement, you have determined that the new Net Income is now $5,000. Using this information, revise the Statement of Cash Flow to determine what the new Cash at the End of the Period would be? (enter your answer as a whole number and don’t use punctuation, example $7,800 would be 7800)

Q3. Now that the Income Statement and the Statement of Cash Flow are updated, the Balance Sheet needs to be updated. Using the new balances, revise the Balance Sheet to determine the new balances for the Total Assets and Total Equity and Liability. (enter your answer as a whole number and don’t use punctuation, example $7,800 would be 7800)

Key Reports Practice Quiz

Q1. If you wanted to view how much a company owes and if payments are overdue, which report group would you run?

  • Customers and Receivables
  • Vendors and Payables
  • Company and Financial
  • Jobs, Time, and Mileage

Q2. Which ratio would you calculate to view a business’s capacity to generate adequate income to repay interest on its debt?

  • Cash Ratio
  • Debt to Asset Ratio
  • Coverage Ratio
  • Return on Total Assets Ratio

Q3. Using the following balance sheet, calculate the Return on Assets ratio using the total assets for the average. (enter your answer as a decimal and round to the nearest thousandths, example x.xxx)

Income from Operations as found on the income statement was $19,710.

Quiz : Reconciliations and Financial Analysis Assessment

Q1. When completing the reconciliation form, what amount should be listed as a Company Error on the balance per book’s side?

  • $174.23
  • $450.23
  • $10,000
  • $275

Q2. Which of these accounts was not impacted by the 3/26/20 journal entry?

  • Intertest Expense
  • Inventory
  • Cash
  • Interest Expense

Q3. Selling expenses in March were more than double February’s amount. What might be the reason?

  • The business made a large investment in social media marketing
  • The business mistakenly made two loan payments in one month
  • The tax rate increased
  • The business sold more computers

Q4. On March 31, what was Circuit Computer’s Accounts Receivable balance? (enter your answer as a whole number and don’t use punctuation, example $7,800 would be 7800)

Q5. Accounts Payable had a beginning balance that was negative. What might this mean?

  • Their supplier gave them a refund or account credit
  • Their customer has not paid yet
  • They are behind on their payments
  • None of these

Q6. Which of these equations should be used to calculate Circuit Computer’s debt-to-equity ratio on March 31?

  • $204,000 / $291,000 = debt-to-equity ratio
  • $291,000 / $87,000 = debt-to-equity ratio
  • $204,000 / $87,000 = debt-to-equity ratio
  • $291,000 / $204,000 = debt-to-equity ratio

Q7. Which month in Q1 produced the highest net profit?

  • February
  • March
  • January

Q8. What was the operating margin in February? (enter your answer as the percentage, without the sign, and round to the nearest hundredth, example xx.xx)

Q9. Which month in Q1 produced the highest net margin?

  • January
  • February
  • March

Q10. The owner of Circuit Computers doesn’t understand why the Cash Account balance doesn’t match the Net Profit on the P&L. Which statement or report would you review to help you answer this question1 point

  • Sales Tax Liability
  • Sales by Customer
  • Balance Sheet
  • Statement of Cash Flows

Q11. During the completion of the bank statement reconciliation, what type of errors were found during the process?

  • Data Entry Errors (transposition)
  • Errors of Principle
  • Errors of Commission
  • Errors of Omission

Q12. What may be a reason the ACH Amazon Refund deposit on 3/30/20 was missed on the books? (Select any that apply)

  • Circuit Computer’s bookkeeper is on a leave of absence and you’re filling in. Maybe the other bookkeeper knew to anticipate this transaction, but you wouldn’t have known
  • The return may have happened last month, but not been refunded until now. The notation was forgotten when the new month’s books were started
  • Automatic deposits and/or transactions are easy to overlook if they are not regularly scheduled events like payroll or loan payments
  • The owner may not have communicated that a return had been made, making it an unanticipated future transaction

Q13. Circuit Computers wrote a check for $12,000 to a vendor for additional supplies on 03/28/20 that had not cleared yet. Where would this be put on the bank reconciliation form that was completed on 3/31/20?

  • Balance per Books side, Company error
  • Balance per Books side, Fees/Returned checks
  • Balance per Bank side, Outstanding checks
  • Balance per Bank side, Deposits in transit

Q14. If the check deposited on 3/28/20 was recorded as seen below, which of the following would be true? (Select all that apply)

  • The cash account would be overstated by $18
  • The error could be corrected by a single journal entry
  • A transposition error would have occurred
  • The cash account would be short $18

Q15. If the ACH deposit on 3/30/20 was transposed in the journal as $147.23 instead of $174.23, but no other errors occurred in the entry, which journal entry below corrects this error?

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