How is the working capital calculated? (Difficulty: Moderate)

Which of the following equations is correct? (Difficulty: Moderate)

Which of the following types of financial structure corresponds generally to a manufacturing company with a negative net cash?
(Note: WC = Working capital, WCN = Working capital need, NC = Net cash) (Difficulty: Moderate)

What is the term used for the analysis that measures the changes over a few accounting period(s) (past or future) of the internal structure of a financial statement? (Difficulty: Moderate)

What is used as common-size basis in the case of the balance sheet? (Difficulty: Moderate)

Andante Co. sells manufactured products for a price of 15 CU per unit. The credit terms received from suppliers of materials are 90 days. It grants credit to its customers for 10 days. Finished products stay in inventory for about 2 days; its raw material inventory turnover is 24. Its transformation process takes one working day; the work is distributed evenly over the day but all materials consumed are put in production at the beginning of the day). Its manufacturing value added to raw materials purchased is 175%. Its gross margin is 26.66%. Its net margin before tax is 6.66%. All costs other than materials are paid cash. The working capital need required to support the sale of one unit is likely to be: (Difficulty: Difficult)

Which of the following four types of firms can safely use a high degree of leverage? (Difficulty: Moderate)

Allegro Corp. reported to its shareholders an X1 before tax profit such that the ROA is 4% and the ROE is 8% (both based on beginning balances). The Return on sales in X1 was 20%. Gross margin was 60% and Sales General and Administrative expenses amounted to 35% of sales. Long-term debts (if there are any) would have been bearing interest at the rate of 5% per year. The reimbursement of the principal would be in fine (i.e., a balloon payment at maturity, which is assumed to beyond the scope of the question). Assume that sales revenue for the year was 1,000 CU. What was the capital structure in the beginning balance sheet? (Difficulty: Difficult)

Trend analysis versus industry average is more useful than comparative common-size analysis of firms in the same industrial sector. This statement is: (Difficulty: Easy)

Two firms, A and B, operate in the same capital-intensive economic sector that undergoes very rapid and continuous technological change and has a short product life cycle. The two firms operate on similar but independent markets. They are essentially similar except for their balance sheet asset and financing structure in the aspects described below (in each possible answer, the differences described are the only ones that distinguish the two firms). In which of the scenarios below is firm A likely to be more profitable than firm B? (Difficulty: Moderate)