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Contents
Description / Instructions: Complete Practice quiz. Week 1...........................................................1
Description / Instructions: Complete practice quiz. Week 2............................................................4
Description / Instructions: Complete practice quiz. Week 3............................................................6
Description / Instructions: Complete practice quiz. Week 4............................................................9
Description / Instructions: Complete practice quiz. Week 5..........................................................13
Description / Instructions: Complete practice quiz. Week 6..........................................................16
a) sole proprietorship
b) partnership
c) corporation
d) a and b
a) sole proprietorship
b) partnership
c) corporation
d) a and b
sole proprietorship
partnership
private corporation
public corporation
Capital budgeting.
Agency conflicts.
Jail time.
Financial losses.
Legal fines.
to take risk.
to hedge risk.
to make deposits.
none of these.
$54,342
$76,342
$12,314
$18,334
$69,655
none of these
$68,931
$63,510
Cash flow from operating activity, minus cash flow invested in net working capital,
minus cash flow invested in long-term assets.
Net income, minus dividends paid to preferred stockholders.
Cash flow from operating activity, plus cash flow generated from net working
capital.
Earnings before interest and taxes times 1 minus the firms tax rate.
It allows management to examine each ratio over time and determine whether the
trend is good or bad for the firm.
The Standard Industrial Classification (SIC) System is used to identify benchmark
firms.
All of these are true statements.
This benchmark is based on a firm's historical performance.
18.34 times
14.15 times
None of these
15.42 times
$1,421 million
$1,651 million
$1,191 million
$1,715 million
a firm's creditors to assess how well the firm will meet its interest obligations.
a firm's creditors to assess how well the firm will meet its short-term liabilities
other than interest expense.
a firm's management to assess how well they meet short-term liabilities.
a firm's shareholders to assess how well the firm will meet its short-term
liabilities.
a) management choosing a set of firms that are similar in size or sales, or who
compete in the same market.
b) using the average ratios of this peer group, which would then be used as the
benchmark.
c) identifying firms in the same industry that are grouped by size, sales, and
product lines, in order to establish benchmark ratios.
d) Only a and b relate to peer group analysis.
Efficiency ratio: If Viera, Inc., has an accounts receivable turnover of 3.9 times and
net sales of $3,436,812, what is its level of receivables?
$881,234
$81,234
$13,403,567
$1,340,357
begins when the firm receives the raw materials it purchased that would be used to
produce the goods that the firm manufactures.
begins when the firm uses its cash to purchase raw materials and ends when the firm
collects cash payments on its credit sales.
ends not with the finished goods being sold to customers and the cash collected on
the sales; but when you take into account the time taken by the firm to pay for its
purchases.
To measure operating cycle we need another measure called the days' payables
outstanding.
$12,890
12,800
12,670
Net sales
$124,589
Cost of goods sold
99,630
Operating cycle: What is the operating cycle for Ridge Company?
36 days
51 days
47 days
85 days
26,154 clocks
161 clocks
15,294 clocks
124 clocks
managers substitute less risky assets for riskier ones to the detriment of bondholders.
managers substitute riskier assets for less risky ones to the detriment of equity
holders.
managers substitute less risky assets for riskier ones to the detriment of equity
holders.
managers substitute riskier assets for less risky ones to the detriment of bondholders.
$4.50
$150
$12.38
$15
7.44%
6.35%
8.80%
8.17%
one year.
ten years.
three to five years.
none of these.
the dollar amount of funds that has to be raised externally and the sources of funds
available to the firm, the desired capital structure for the firm, and the firm's dividend
policy.
the dollar amount of funds that has to be raised externally and the sources of funds
available to the firm, the firm's dividend policy, and the firm's working capital policy.
the firm's dividend policy, the desired capital structure for the firm, and the firm's
working capital policy.
the dollar amount of funds that has to be raised externally and the sources of funds
available to the firm, the desired capital structure for the firm, and the firm's working
capital policy.
25%, 75%
69%, 31%
34%, 66%
66%, 34%
$2,545
$2,404
$2,713
$2,250
$39,208
$33,124
$36,022
$41,675
$309,432
$412,372
$434,599
$361,998
$124,868
$251,154
$101,766
$186,250
$28,403
$24,670
$26,124
$21,000
$990
$945
$1,066
$872
$11.88
$11.50
$9.80
$10.76
PV of dividends: Givens, Inc., is a fast growing technology company that paid a $1.25
dividend last week. The company's expected growth rates over the next four years are
as follows: 25 percent, 30 percent, 35 percent, and 30 percent. The company then
expects to settle down to a constant-growth rate of 8 percent annually. If the required
rate of return is 12 percent, what is the present value of the dividends over the fast
growth phase?
$8.37
$7.24
$1.25
$6.46
$150,000
$137,500
$112,500
$125,000
capital rationing.
risk analysis.
budgeting.
rationing.
2.09
2.18
0.09
1.09
19.75%
24.00%
32.50%
58.00%
4.5%
7.0%
9.0%
9.2%
12.500%
12.890%
6.250%
8.125%
4.10
1.28
1.60
1.0
Efficiency projects
Extension projects
New product projects
Market expansion projects
26.5%
6.4%
32.9%
30.3%