Accounting Chapter 9-Ratio Analysis

Financial statement that reports the net income or net loss for the fiscal period it covers is the

• income statement

• balance sheet

• changes in equity

This occurs when total revenue is greater than total expenses

• net income

• net loss

The amount by which current assets exceed current liabilities is known as

• working capital

• capital

When total revenue is less than total expenses

• net loss

• net income

Financial statement that is a report of the final balances in all asset, liability, and owner's equity accounts at the end of the fiscal period

• balance sheet

• current assets

The relationship between current assets and current liabilities is the current ratio.

• true

• false

This ratio is used to examine the portion of each sales dollar that represents profit

• return on sales

• return on dollars

Assets used up or converted to cash during the normal operating cycle of the business

• current assets

• current liabilities

A net loss and withdrawals both cause an increase in the capital account.

• true

• false

The balance sheet represents the basic accounting equation.

• true

• false