Question 1

An increase in which one of the following accounts increases a firm's current ratio without affecting its quick ratio?

Accepted Answer

A) Accounts payable 
B) Cash 
C) Inventory 
D) Accounts receivable 
E) Fixed assets 
A) Accounts payable 
B) Cash 
C) Inventory 
D) Accounts receivable 
E) Fixed assets

Question 2

A supplier,who requires payment within ten days,should be most concerned with which one of the following ratios when granting credit?

Accepted Answer

A) Current 
B) Cash 
C) Debt-equity 
D) Quick 
E) Total debt 
A) Current 
B) Cash 
C) Debt-equity 
D) Quick 
E) Total debt

Question 3

The inventory turnover ratio is measured as:

Accepted Answer

A) sales divided by inventory. 
B) inventory times total sales. 
C) cost of goods sold divided by inventory. 
D) inventory divided by cost of goods sold. 
E) inventory divided by sales. 
A) sales divided by inventory. 
B) inventory times total sales. 
C) cost of goods sold divided by inventory. 
D) inventory divided by cost of goods sold. 
E) inventory divided by sales.

Question 4

The Lumber Mill has total assets of $591,600,current liabilities of $49,700,dividends paid of $12,000,net sales of $68,400,and net income of $55,400.Assume that all costs,assets,and current liabilities change spontaneously with sales.The tax rate and dividend payout ratios remain constant.If the firm's managers project a firm growth rate of 6 percent for next year,what will be the amount of external financing needed to support this level of growth? Assume the firm is currently operating at full capacity.

Accepted Answer

A) $3,200 
B) −$13,490 
C) −$17,520 
D) $15,640 
E) $16,380 
A) $3,200 
B) −$13,490 
C) −$17,520 
D) $15,640 
E) $16,380

Question 5

A public firm's market capitalization is equal to the:

Accepted Answer

A) total book value of assets less the book value of debt. 
B) par value of common equity. 
C) price per share multiplied by number of shares outstanding. 
D) stock price per share multiplied by the number of shares authorized. 
E) maximum value an acquirer would pay for the firm in an acquisition. 
A) total book value of assets less the book value of debt. 
B) par value of common equity. 
C) price per share multiplied by number of shares outstanding. 
D) stock price per share multiplied by the number of shares authorized. 
E) maximum value an acquirer would pay for the firm in an acquisition.

Question 6

The sustainable growth rate will be equivalent to the internal growth rate when,and only when:

Accepted Answer

A) a firm has no debt. 
B) the growth rate is positive. 
C) the plowback ratio is positive but less than 1. 
D) a firm has a debt-equity ratio equal to 1. 
E) the retention ratio is equal to 1. 
A) a firm has no debt. 
B) the growth rate is positive. 
C) the plowback ratio is positive but less than 1. 
D) a firm has a debt-equity ratio equal to 1. 
E) the retention ratio is equal to 1.

Question 7

Cado Industries has total debt of $6,800 and a debt-equity ratio of .36.What is the value of the total assets?

Accepted Answer

A) $18,889 
B) $24,480 
C) $23,520 
D) $25,689 
E) $25,360 
A) $18,889 
B) $24,480 
C) $23,520 
D) $25,689 
E) $25,360

Question 8

New Tek has a sustainable growth rate of 11.2 percent.However,the firm's managers are determined that the firm should grow by at least 20 percent next year.What must the firm do if the managers are to reach their desired level of growth for the firm?

Accepted Answer

One reason that causes firms to go out o

An increase in which one of the following accounts increases a firm's current ratio without affecting its quick ratio?

A supplier,who requires payment within ten days,should be most concerned with which one of the following ratios when granting credit?

The inventory turnover ratio is measured as:

A public firm's market capitalization is equal to the:

The sustainable growth rate will be equivalent to the internal growth rate when,and only when:

Cado Industries has total debt of $6,800 and a debt-equity ratio of .36.What is the value of the total assets?

New Tek has a sustainable growth rate of 11.2 percent.However,the firm's managers are determined that the firm should grow by at least 20 percent next year.What must the firm do if the managers are to reach their desired level of growth for the firm?

Introduction to Corporate Finance

Financial Statements and Cash Flow

Discounted Cash Flow Valuation

Net Present Value and Other Investment Rules

Making Capital Investment Decisions

Risk Analysis, real Options, and Capital Budgeting

Interest Rates and Bond Valuation

Stock Valuation

Lessons From Market History

Return, risk, and the Capital Asset Pricing Model Capm

An Alternative View of Risk and Return: the Arbitrage Pricing Theory

Risk, cost of Capital, and Valuation

Efficient Capital Markets and Behavioral Challenges

Long-Term Financing

Capital Structure: Basic Concepts

Capital Structure: Limits to the Use of Debt

Valuation and Capital Budgeting for the Levered Firm

Dividends and Other Payouts

Raising Capital

Leasing

Options and Corporate Finance

Options and Corporate Finance: Extensions and Applications

Warrants and Convertibles

Derivatives and Hedging Risk

Short-Term Finance and Planning

Cash Management

Credit and Inventory Management

Mergers,acquisitions,and Divestitures

Financial Distress

International Corporate Finance

Filters

Exam 3: Financial Statements and Cash Flow

An increase in which one of the following accounts increases a firm's current ratio without affecting its quick ratio?

A supplier,who requires payment within ten days,should be most concerned with which one of the following ratios when granting credit?

The inventory turnover ratio is measured as:

A public firm's market capitalization is equal to the:

The sustainable growth rate will be equivalent to the internal growth rate when,and only when:

Cado Industries has total debt of $6,800 and a debt-equity ratio of .36.What is the value of the total assets?

New Tek has a sustainable growth rate of 11.2 percent.However,the firm's managers are determined that the firm should grow by at least 20 percent next year.What must the firm do if the managers are to reach their desired level of growth for the firm?

Introduction to Corporate Finance

Financial Statements and Cash Flow

Discounted Cash Flow Valuation

Net Present Value and Other Investment Rules

Making Capital Investment Decisions

Risk Analysis, real Options, and Capital Budgeting

Interest Rates and Bond Valuation

Stock Valuation

Lessons From Market History

Return, risk, and the Capital Asset Pricing Model Capm

An Alternative View of Risk and Return: the Arbitrage Pricing Theory

Risk, cost of Capital, and Valuation

Efficient Capital Markets and Behavioral Challenges

Long-Term Financing

Capital Structure: Basic Concepts

Capital Structure: Limits to the Use of Debt

Valuation and Capital Budgeting for the Levered Firm

Dividends and Other Payouts

Raising Capital

Leasing

Options and Corporate Finance

Options and Corporate Finance: Extensions and Applications

Warrants and Convertibles

Derivatives and Hedging Risk

Short-Term Finance and Planning

Cash Management

Credit and Inventory Management

Mergers,acquisitions,and Divestitures

Financial Distress

International Corporate Finance

Filters