Corporate Finance Analyst Sample Questions

Sample Questions


1. Which of the following items is NOT a source of information from the corporate annual report?

A. Management's discussion and analysis.    
B. Supplementary schedule of segment information.
C. Auditor's report.
D. Value Line Investment Survey.

2. Which of the following tools and techniques are the most useful to the financial statement analyst?

A. Crossing refers to correction to be done by Bank if any
B. Common size financial statements and financial ratios.
C. The letter to the shareholders and a map.
D. None of the above

3. What type of ratios measure the liquidity of specific assets and the efficiency of managing assets?

A. Profitability ratios.    
B. Liquidity ratios.
C. Activity ratios.
D. Leverage ratios.

4. Which of the following statements is false?

A. Financial ratios are predictive.    
B. No rules of thumb apply to the interpretation of financial ratios.
C. Financial ratios can indicate areas of potential strength and weakness.
D. Financial ratios can serve as screening devices.

5. Which of the following ratios would be useful in assessing short-term liquidity?

A. Average collection period, debt ratio, return on assets.    
B. Current ratio, quick ratio, cash-flow liquidity ratio.
C. Current ratio, inventory turnover, fixed asset turnover.
D. Quick ratio, accounts receivable turnover, return on assets.

Answers:      1 (D), 2 (B), 3 (C), 4 (A), 5 (B)


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