IPA IP 2024 Question 30
A question IPA Japan published in 令和6年度 ITパスポート試験 公開問題 問30, translated into English. ITPEC is based on the same exams.
Your superior handed you the company’s income statement for the current period and said, “Analyze the profitability of our company.” Among the management indicators, which of the following lists all and only those that can be calculated from this income statement alone?
Explanation
B only — the ratio of profit to net sales needs only figures that the current period's income statement contains.
- •A Sales growth rate: (current net sales − previous net sales) ÷ previous net sales × 100. It needs the previous period's net sales, which the current income statement does not give.
- •B Ratio of profit to net sales: profit ÷ net sales × 100, with gross, operating, ordinary or net profit. Both figures are in the income statement. Calculable.
- •C Return on equity (ROE): net income ÷ equity × 100. Net income is in the income statement, but equity (net assets) is on the balance sheet.
Answer (d)
Why not others:
- •(a) A — the growth rate compares two periods, so it needs last period's figures too
- •(b) A, B — includes A, which needs last period's sales
- •(c) A, B, C — also includes C, which needs equity from the balance sheet
Key rule: Ratios of one income statement item to another (profit margins) come from the income statement alone; growth rates need a second period, and returns on equity or assets need the balance sheet.
Corporate Activities · AI-written, may contain errors
This question comes from the past questions IPA Japan publishes, translated into English by ITPEC Practice. ITPEC Practice is an independent study tool and is not affiliated with IPA or ITPEC. See the original paper (PDF) or Report an issue.