Section A
1-Choose the correct answer (2/. )
1- A common-size income statement is an accounting statement that express all of a firm’s
expenses as percentage of
a- Asset
b- Equity
c- Net income
d- Sales
2- Which of the following balance sheet equations is INCORRECT?
a- Asset – Liabilities = Shareholders’ Equity
b- Asset = Liabilities + Shareholders’ Equity
c- Asset – Current Liabilities = long term Liabilities
d- Asset – Current Liabilities = long term Liabilities Shareholders’ Equity
3- Which of the following is an example of an intangible asset?
a- Brand names and trademark
b- Patents
c- Customer goodwill
d- All of the above
4- ………………………… is more like a video of the firm’s operations for a specified period of time
a- Balance sheet
b- Income statement
c- Cash flow statement
d- None of the above
Discuss 2 of the potential problems with ratio analysis. (2/. )

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