CFA Practice Question

There are 534 practice questions for this study session.

CFA Practice Question

The following table presents selected common-size income and balance sheet data for Curative Drugs.

Which of the following conclusions can be drawn from the data presented above?
A. Curative is tightening its inventory and accounts receivables policies.
B. Curative shareholders are earning more per dollar invested in the company with time.
C. Curative's sales, general and administrative costs are rising over time.
Explanation: Curative's COGS are steady as a percentage of sales. This implies its gross margin is also steady. A decline in operating margin indicates that its sales, general and administrative expenses are going up as a fraction of its sales.

User Contributed Comments 0

You need to log in first to add your comment.