FREE Certified Management Accountant Question and Answers

Question 1

What doesn't a balance sheet include?

Accepted Answer

Taxes paid

Answer

Patents

Answer

Deposits

Answer

Accrued expenses

Question 2

Which item appears in the cash flow statement?

Accepted Answer

Payments made for products and services

Answer

Net income

Answer

Investment by shareholders

Answer

Accrued income

Question 3

Which part of a company's financial statements include information about its liquidity?

Accepted Answer

Management Discussion and Analysis

Answer

Cash flow statement

Answer

Notes to the financial statement

Answer

Statement of changes in shareholders' equity

Question 4

The Acid-Test Ratio is calculated in what way?

Accepted Answer

Cash, accounts receivable, and short-term investments divided by current liabilities

Answer

Current assets divided by current liabilities

Answer

Accounts payable divided by cost of sales and multiplied by days in accounting period

Answer

Sales divided by inventory

Question 5

What financial ratio is employed to assess the risk of an organization?

Accepted Answer

Debt-to-equity ratio

Answer

Current ratio

Answer

Acid-test ratio

Answer

Days sales outstanding in receivable

Question 6

Which financial ratio reveals the extent to which a company's net assets can pay down its debt?

Accepted Answer

Asset Coverage ratio

Answer

Earning to Fixed assets ratio

Answer

Time Interest Earned ratio

Answer

Debt to total assets ratio

Question 7

A company's return on investment analysis may or may not be helpful in measuring...

Accepted Answer

operational efficiency

Answer

profitability from operations

Answer

the earning potential of an asset

Answer

how well an organization uses resources