CMA Pop Quiz: How did you do on our #CMAPopQuiz? #CMA
Solution: C
The only measure not affected by the purchase of its own common stock is Douglas' net profit margin. Both the debt/equity ratio and the earnings per share are affected by the number of outstanding shares of common stock, while the current ratio is affected by the amount of cash held.
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Christine Purelis
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Original Message:
Sent: 01-19-2018 01:14 PM
From: Christine Purelis
Subject: CMA Pop Quiz- Q&A 215
CMA Pop Quiz: Are you preparing for the #CMA exam? Take our #CMAPopQuiz!
Douglas Company purchased 10,000 shares of its common stock at the beginning of the year for cash. This transaction will affect all of the following EXCEPT the
a. debt-to-equity ratio.
b. earnings per share.
c. net profit margin.
d. current ratio.
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Christine Purelis
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