In the Analysis of Profitability,if Equity Earnings Are Substantial,it Is

question 24

Multiple Choice

In the analysis of profitability,if equity earnings are substantial,it is advisable to:

• A)consider them as extraordinary.
• B)consider them as nonrecurring.
• C)investigate the earning power of the parent outside of the related investing activities.
• D)recompute the debt ratio and times interest earned to remove the impact of equity earnings.
• E)use the DuPont method to lessen the impact of equity earnings.

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Definitions:

Pitch Decks

Concise presentations used by entrepreneurs to provide investors with a quick overview of their business plan, including the problem, solution, market size, and financial projections.

Competitors

Entities that are in the same industry and vie for the same customers or resources.

Pitch Deck

A concise presentation used by startups and entrepreneurs to provide an audience with a quick overview of their business plan, often with the goal of securing investment or partnership.

Market

The arena in which buyers and sellers come together to exchange goods, services, or information.