SUMMARY3
List some of the different types of people who might wish to analyze
Name the two main recognized accounting standards and provide some basic differences between the two.
What are the main components of a balance sheet?
Describe three types of ratio analysis.
Describe two limitations of financial accounting data.
For each exercise, work out the ratio using the formulas introduced
Calculate the quick ratio
Omar’s computing service has annual sales of SAR 2,013,000 and accounts receivable of SAR 825,000. What is its receivables turnover?
Asma’s technology company has sales of SAR 12,560,000, fixed assets of SAR 3,000,000, and total assets of SAR 4,500,000.
Rasheed’s solar supplies has revenues of SAR 58,000,000 and cost of goods sold of SAR 25,100,000. What is the company’s gross profit margin?
Rasheed’s solar supplies has revenues of SAR 58,000,000 and cost of goods sold of SAR 25,100,000. What is the company’s gross profit margin?
Choose the correct answer. 1. Patents and trademarks should be considered as shareholder’s equity.
The statement of cash flows is divided into these sections EXCEPT:
Leverage ratios measure the firm’s use of debt financing.
Match the terms listed with their definitions. Write the letters of the correct definitions.
Balance sheet equation: Total assets = Total liabilities + Total shareholders’ equity
Analyzing Performance Through Financial Reporting
List three types of financial statements discussed in this book that Ali could create to analyze the business.
How can analysis of financial statements help Ali in assessing and improving the financial efficiency of the business?
Understanding the Balance Sheet
Using your knowledge of balance sheets, explain why the company director has questioned the data provided by Abdullah.
Suggest what actions Abdullah could take to resolve the issue.
Using Ratio Analysis to Assess Company Performance
Show how Mira would work out the current ratio and the quick ratio. Based
What additional information would Mira need in order to work out the company’s gross profit margin?
CASE STUDY: FINANCIAL REPORTING AT SAUDI ARAMCO
The Saudi Aramco website provides a wide range of insightful information
Which accounting standard does Saudi Aramco use for its financial reporting?
Describe three ratios that could be used to analyze Saudi Aramco’s financial performance. Explain how each can provide a different insight.
Visit the Saudi Aramco webpage (www.aramco.com) to view or download the Annual Report 2021,
