**Purpose**: (L.O. 1 thru 7) This exercise will quiz you about terminology used in this chapter.

A list of accounting terms with which you should be familiar appears below:

Acid-test (quick) ratio | Price-earnings (P-E) ratio |

Asset turnover | Profit margin |

Change in accounting principle | Profitability ratios |

Comprehensive income | Pro forma income |

Current ratio | Quality of earnings |

Debt to total assets ratio | Ratio |

Discontinued operations | Ratio analysis |

Earnings per share (EPS) | Receivables turnover |

Extraordinary items | Return on assets |

Horizontal analysis | Return on common stockholders' equity |

Inventory turnover | Solvency ratios |

Leveraging | Times interest earned |

Liquidity ratios | Trading on the equity (leverage) |

Payout ratio | Vertical analysis |

**Instructions**

For each item below, enter in the blank the term that is described.

- __________________________________ A technique for evaluating financial statement data that expresses each item within a financial statement in terms of a percent of a base amount; often called common-size analysis.
- __________________________________ A technique for evaluating a series of financial statement data over a period of time to determine the increase (decrease) that has taken place, expressed as either an amount or a percentage; often called trend analysis.
- __________________________________ An expression of the mathematical relationship between one quantity and another. The relationship may be expressed either as a percentage, ...

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