Match Each Term with the Appropriate Definition

question 48

Multiple Choice

Match each term with the appropriate definition.Not all definitions will be used.
-Management Discussion and Analysis

• A)The practice of reporting information in percentages rather than monetary amounts.
• B)A nonrecurring item on the income statement that reflects gains and losses associated with extraordinary events.
• C)Another name for a trend analysis.
• D)An increase in an asset or a decrease in a liability that results from peripheral activities.
• E)A section of the annual report that can be used in interpreting the results of financial statement analysis.
• F)The ratio calculated by dividing the price of a share of stock by the earnings per share.
• G)After-tax earnings adjusted for gains and losses that may disappear before they are realized.
• H)A nonrecurring item associated with abandoning or selling an operation.
• I)The practice of reporting accounting data in the national monetary unit.
• J)Also known as ratio analysis.
• K)The ratio calculated by dividing the net income by the number of common shares outstanding.
• L)The earnings of a company after taxes.

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Definitions:

Cost Ratio

A financial metric that compares two cost-related factors against each other, often used to measure the efficiency or profitability of an operation.

Times Interest Earned Ratio

A financial metric used to measure a company's ability to meet its debt obligations, calculated as earnings before interest and taxes (EBIT) divided by interest expenses.

Operating Activities

The day-to-day activities of a business related to producing and selling its product, providing services, or other activities that are not investing or financing.

Common Size Income Statement

An income statement in which each line item is expressed as a percentage of sales revenue, facilitating comparison across companies or periods.