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21 Dec 2018

1. Holy Regis invested 10,000 in a saving account that paid an annual interest rate of 6% compounded monthly. In three years, holly will have
A. 11,967
B. 10,623
C. 11,415
D. 11,067
E. None of the above


2. The concept that an item is not large enough to influence the users of a financial statement is
A. Cost effectiveness
B. Materiality
C. Reliability
D. Relevance
E. None of the above


3. Credit sales increase
A. cash
B. Accounts recieveable
C. Owners equity
D. Both b and c
E. None of the above

4. Karen is saving for a car. The car cost 22,000. How much must Karen invest in a savings account that pays 4% annually to have the $22,000 in three years. Round to the nearest dollar
A. $20,147
B. $19,107
C. $19,558
D. $19,328
E. None of the above


5. The quality that ensure that information is reasonable free from error is
A. Reliability
B. Relevant
C. Understandability
D. Consistent
E. None of the above


6. Which of the following is not an expense?
A. Utilities
B. Insurance
C. Dividends
D. Cost of goods sold
E. None of the above

7. Ginger invested $10,000 in a bank account offshore bank. The account pays 3% interest compounded annually. How much will Ginger have in 5 years? Round to the nearest dollar
A. $11,593
B. $11,108
C. $10,123
D. $12,619
E. None of the above

8. Holly invested $6,000 in a savings account that paid an annual interest rate f 6%!l compounded annually. In three years, holly will have
A. $11,967
B. $10,623
C. $11,415
D. $11,067
E. None of the above

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23 Dec 2018

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Related questions

1.The concept that an item is not large enough to influence the users of a financial statement is

A, cost effectiveness

b. Materiality

c. reliability

d. relvance

e. none

2. The quality that allows quantitative assessment of the similarities and differences among enterprises is known as

a.comparability

b. consistency

c. reliability

d. relevance

e. none

3. Profit margin and asset turnover can be combined to create

a. return on assets

b return on equity

c. earnings per share

d. price earnings ratio

e. none

4.which of the following increases cash

a. issuance to long term debt

b. acquisition of property plant and equipment

c. payment of divdends

d decrease in short term debt

e. none

5. if a company pays out more than the income tax incurred as shown in the income tax liability decrease, the effect on cash is a

a. decrease

b. increase

c.no effect

d. none of the above

6. which of the following increases cash

a. increase in inventory

b. increase in accounts receivable

c. increase in the accounts payable

d. none

7.Grayson is saving for a used car. He needs $14,000. How much he invest at 3% annual interest rate to have $ 14,000 in two years? Round to the nearest dollar.

a. 12,983

b.12,417

c. 13,720

d. 13.196*

e, none

8.ellen fetter invested $5,000 in a savings account that paid 5% interest compounded annually. She kept the account for three years. At the end of the three years, ellen will have approimentely

a. $6,103

b. $5,444

c.5,414

d.5,788*

e. none

9. Which of the following is a snapshot of the financial position of a company

a. Balance sheet

B.income statement

C. statement of retained earnings

D. cash flow statement

e. none

10.which of the following rations is not useful for comparison purposes?

a. return on assets

b. price earnings ratio

c. return on equity

d. earnings per share

e. none*

11.elsie Jackson is saving for a down payment on a condo. She needs 20,000. How much must she invest in a savings account that pays 5% annually to have the 20,000 in 8years? Round to the nearest dollar.

a. 13,206

b $12,983

c. 13,616

d. 13,537

e. none

12.which of the following is added to net income to calculate cash flow?

a. depreciation

b. increase in accounts receivable

c. increase in inventory

D. decrease in accounts payable

e. none

13. which of the following increase cash?

a.issuance of long term debt

b. acquisition of property plant and equipment

c. payment of divdends

d. decrease in short term debt

e. none

14. profit margin and asset turnover can be combined to create

a. return on assets

b. return on equity

c. earnings per share

d. price earnings ratio

e. none

15.Bart is saving for college. He needs 20,000 for the first year. How much must he invest at a 5% annual interest rate to have 20,000 in five years? Round to the nearest dollar?

a. 14.982

b.15,016

c.15,023

d 15,671

e none

16.which of the following are added to net income to determine cash flow from operating activities?

a. depreciation

b. amortization

c. both a and b*

d. gain on asset sale

e. none

17. which of the following ratios is coverage ratio

a. return on assets

b. return on equity

c. earnings per share

d. times interest earned

e. none

18. ellis industries is a large, multinational company located in the us. Ellis’s financial statements are in us dollars. This GAAP is known as

a. monetary concept

b. economic entity

c.conservatism

d. matching

e. none

19.ginger Ellison invested $10,000 in a bank account at offshore bank. The account pays 3% interest compounded annually. How much will Ginger have in five years? Round to the nearest dollar?

a. 11,593

b. 11,108

c. 10,213

d. 12,619

e. none

20.which ratio is wall street’s favorite

Inventory turnover

B. receivables turnover

Current

D. price- earnings*

E. none

21. ginger Ellison invested $10,000 in a bank account at offshore bank. The account pays 3% interest compounded annually. How much will Ginger have in five years? Round to the nearest dollar?

a. 11,593

b. 11,108

c. 10,213

d. 12,619

e. none

22.information that can make a difference to the decision at hand is considered to be

a. a reliable

b. a comparable

c. relevant

d. understandable

c. none

23. Blackson incorporated signed a 3 year lease for the building that blackson occupies and paid the first 6 months in advance. The account that should be debited is

a. prepaid expenses

b. cash

c. building

d. accounts payable

e. none

24.right-hand entries increase

a. asset accounts

b owners equity accounts

c. liabilities

d. both b and c

e. none

25.The quality that ensures that information is reasonably free from error is

a. reliability

b. relevant

c. understandability

d. consistent

e. none

26. a customer pays on an account receivable. The account that should be credited is

a. inventory

b. cash

c. accounts payable

d. accounts receivable

e. none

27. which of the following ratios measures liquidity?

a. current

b. payout

c. gross margin

d. asset turnover

e. none

28. Jesse Ellis invested $4,000 in a savings account that paid 6% interest compounded annually for 6 years. At the end of 6 years, Jesse will have approximately.

A. 5,103

b. $5,674

c. 5,506

d.4,903

e.none

29. which of the following is not a functional area of accounting?

a. Managerial accounting

b. tax accounting

c.economic accounting*

d. financial accounting

e. none

30.John Vincent invested $10,000 in a savings account. The account pays 4,5% annual interest. John will have much in the account at the end of 10 years? Round to the nearest dollar.

a. 15,530

b. 14,984

c. 16,010

d. 16,311

e none

31.capital stock is a part of which of the following accounts?

a. owners’ equity

b. liabilities

c. current assets

d. long term assets

e. none

32.The stock market values a company based on which of the following accounts?

a. assets

b. liabilities

c. capital stock

d. retained earnings*

e none

33. The following accounts are listed in order of liquidity

a. current assets

b. current liabilities

c. both a and b

d. long term assets

e. none

34. When shares are sold from one shareholder to another in the open market: the following accounts is impacted

a. capital stock

b. retained earnings

c. long term liabilities

d. current assets

e. none*

35. The accounts that reflects the amount the owners have invested in the business is

a. capital stock

b. retained earnings

c. long term liablilties

d. long term assets

d. none

36. Karen Quigley is saving for new car. The car cost $22,000. How much must Karen invest in a savings account that pays 4% annually to have the $22,000 in three years? Round to the nearest dollar.

a. 20,147

b. 19,107

c. 19,558

d.19,328

e. none

37. Agr corporation signed a two-yr lease for the building that the company occupies. The account that should be debited is

a. prepaid expense

b.cash

c. accounts payable

d. building

e. none

38. left-hand entries DECREASE

a. asset accounts

b. liability accounts

c. owner’s equity accounts

d. both b and c*

e.none

39. which of the following is a source of cash? (question 42 different choices)

a. issuance of long-term debt

b. increase in inventories

c. decrease in accounts payable

d. increase in accounts receivable

e. none

REPEAT Different choice 40. which of the following increases cash?

Issuance of long-term debt

Acquition of property plant and equipment

Cpaymentof divdends

D. decrease in short term debt

none

41.The ratio that shows how much in excess of current earnings investors are willing to pay for company stock is.

A payout

b.current

c, price-earnings*

d.return on equity

e none

42. which of the following is a source of cash?

A increase in accounts recievable

b. increase in inventories

c. increase in accounts payable

d. none*

43. A gain on the sale of an asset is subtracted from net income to determine cash flow from operating activities because of

a. double counting

b. asset sales require a basis

c. losses are cash flow neutral *

d. none

44. which of the following is an expense allocation scheme?

a. cost of goods sold

b. amortization

c. Depreciation

D. Band C*

e. none

45.The account that reflects the amount the owners have invested in the business is

a. capital stock

b. retained earnings

c. long term liabilies

d. long term asset

e. none

46. which of the following statements represents a flow concept?

a. balance sheet

b. income statement*

c. statement of retained earnings

d. inventory statement

e. none

47. left- hand entries INCREASE

a. asset accounts

b. liability accounts

c. owners’ equity accounts

D. both B and C

e. none

48.which of the following ratios measures operating performance?

a. price-earnings

b. current

c. receivable turnover*

d. operating cycle

e. none

49. credit sales increase

a. cash

b. land

c. owners’ equity

d. accounts payable

e. none*

50.Projecting inventory levels for next year would be an example of

a. financial accounting

b managerial accounting*

c. tax accounting

d. none

51. investments representing long term holdings of securities would appear on the balance sheet as

a. long term liabilities

b long-term asset

c. capital stock

d. retained earnings

e. none*

52. which organization is recognized today as the authoritative voice of accounting rules and principles?

a. sec

b. aICPA

c.FASB *

d.AAA

e. none

53. which account below would be credited to record this transaction: purchase merchandise for resale on credit

a. inventory

b. cash

c. accounts payable *

d.accounts receivable

e. none

54. Formis, Inc. estimates the useful life of each asset purchased and depreciates the asset over the useful life. This GAAP is known as

a. Monetary concept

b. economic entity

c. going concern

d. matching*

e. none

55. which of the following is one gauge of the company’s ability to meet its short-term obilgations?

a. gross margin

b. asset turnover

c. profit margin

d. working capital*

e. none

1.Ellison corporation acquires redstone corporation because redston has unused production facilities that Ellison needs. This is an example of

a.diversification

b. vertical integration

c. Horizontal integration

d. None of the above

2. Synergy may result from which of the following?

a. Enhanced cash flow

b. Diversification

c. Excess cash

d. All of the above

3.Which of the following is not a qualitative factor?

a. Product users

b. Industry maturity

c. Sales of growth

d. Barriers to entry

e. None of the above

4.Present value calculations

a. Can help the creation of value

b. Can provide managers with a means of identifying the best investment choices.

c. Do not help in the creation of value

d. A and b

e. B and c

5. Which of the following ratios makes firm comparisons difficult?

1. EPS

2. Payout

3. Return on assets

4. ROE

5. None of the above

6. Breakeven EBIT analysis leads to

a. Issuance of debt

b. Issuance of stock

c. Both a and b

d. Either a or b

e. None of the above

7. If the bond’s coupon rate is greater than the general interest rates in the market, the bond will set at a

A. premium

b. discount

c. neither a nor b

8. As the interest rate used to discount future cash flows is decreased, present value of the future inflows

a. Increases

b. Decreases

c. Stays the same

9. The ______________ matches revenues with expenses for the entire accounting period

a. Balance sheet

b. Cash flow statement

c. Statement of retained earnings

d. Income statement

e. None of the above

10. What performing sensitivity analysis

a. Statistical methods should not be employed

b. Electronic spreadsheets make the job more manageable

c. Assumptions should be changed one at a time

d. All of the above

e. B and c

11.Jones is saving for a new outboard motor. He needs to have 10,000 4 years from now. How much must he set aside not have 10,000, 4 years from now if money compounds at 12% annually.

a.$6310

b. $6355

c. $6332

d. $6106

e. None of the above

12.A firms dividend policy impacts the firm’s ability to finance through

a. Retained earnings

b.Stock issue

c. Long term debt

d. None of the above

13. Synergy between two companies

a. Is the complimentary situation where value is created in the joining o the firms

b. May result in the improvement of the acquirers bottom line

c. Could be defined by purely qualitative benefits

d. A and c

e. B and c

15. The percentage of net income that a company distribution in dividends is referred to as the

a. EPS

b. Payout ratio

c. ROA

d. ROE

e. None of the above

16. The statement that shows investment is the firms and the distributions to owners is the

a. Income statement

b. Balance sheet

c. Statement of retained earnings

d. None of the above

17. Which of the following methods results in a net present value of zero?

a. IRR

b. Payback

c. Discounted payback

d. None of the above

18. Ivy company acquires Reynolds company. Reynolds is in a totally unrelated business to Ivy. This is an example of

a. Vertical integration

b. Horizontal integration

c. Diversification

d. None of the above

19. Which of the following limits a firm’s ability to raise equity through retained earnings?

a. Set divided policy

b. Low p/e

c. High p/e

d. None of the above

20. Testing the validity of your calculations by subjecting them to change is known as

a. Qualitative testing

b. Horizontal analysis

c. Vertical analysis

d. Sensitivity analysis

e. None of the above

21. Gadsen acquires digital corporation which is upstream in the marketing chain. This is an example of

a. Diversification

b. Vertical integration

c. Horizontal integration

d. None of the above

22. Which of the following methods help to “size” the investment?

a. Payback

b. Present value payback

c. Present value index

d. IRR

e. None of the above

22. Aspect company acquires Penn company which is downstream in the production chain. This is an example of

a. Diversification

b. Vertical integration

c. Hortizontal integration

d. None of the above

23.The “efficient market” theory means to be reasonable because

a.There are fewer financial analysts valuing securities

b.There are hundreds of investors trying to make money from improperly valued securities, and the market forces which result in driving stock prices to fair value.

c. A and b

d. None of the above

24. Economic value is the same as

a. Book value/ net asset value

b. Owners equity

c. None of the above

25.When projected assets are more than projected liabilities and owners equity the plug will be

a. Notes payable

b. Notes receivable

c. Cash

d. None of the above

26. In a new issue, the ____ are those funds that remain after the neccessry fees have been deducted

a.Working capital

b.Free cash flow

c.Net proceeds

d.None of the above

27.A discount factor

a.Is the same as compounding future cash flows

b.Performs the reverse function of a compounding interest rate

c.Allows investors to quantify a figure which will assist them in comparing alternative investments

d.B and c

e.A, b, and c

28.Which of the following ratios is not a liquidity ratio?

a.ROE

b.Current

c.Quick

d.Receivable turnover

e.None of the above

29.Adrian Ardeel is saving for a new guitar. How much must Adrian set aside now to receive $4000, 7 years from now using a compound interest rate of 7% annually.

a.$2400

b.$2491

c.$2411

d.$2500

e.None of the above

30.The bond’s yield to maturity calculation is similar to a ______ calculation

a.NPV

b.IRR

c.Payback

d.Discounted payback

e.None of the above

31.Eric sets aside $100. If this money compounds at a 5%annual rate how much will Eric have 6 years from now?

a.$110

b.$121

c.$134

d.$138

e.None of the above

32.Which of the following methods does not consider the time value of money?

a.IRR

b.NPV

c.Payback

d.None of the above

33.Assessing key ratios of the company is an example of

a.Qualitative analysis

b.Quantitative analysis

c.Price level effect

d.Fixed cost

e.None of the above

34.The ratio which may observers use to quantify the stock markets opinion of a firm is the

a.ROE

b.EPS

c.D/E

d.P/E

e.None of the above

35.A bond which is valued at par has a yield to maturity which is _____ to its coupon rate

a.Equal to

b.Greater than

c.Less than

d.None of the above

36.Many coverage ratios include

a.Sinking fund obligations

b.Dividends

c.Both a and b

d.None of the above

37.The cost of capital can be defined as

a.The weighted average cost of attracting investors to the firm

b.The price of obtaining funding for the firm weighed according to target ratios in the capital structure

c.Less than the weighted average that investors in the firm require

d.A and b

e.A, b, and c

38.Most bonds pay interest

a.Monthly

b.Quarterly

c.Semiannually

d.Annually

e.None of the above

39.The quantitative method that often serves as an indicator of a firms ability to meet contractual obligations is

a.Receivables turnover

b.Inventory turnover

c.ROE

d.Coverage ratio

e.None of the above

Hello, I am having some trouble with my Finance homework. I was wondering if someone could check the answers for me. (explanations are very helpful, but not necesary)

1) How much money will Jane Mims have in three years if the money compounds at an annual rate of 10% and she sets aside $1000

A) $1300

B)$1331

C) $1406

D) $1420

E) None of the Above

2) As the interest rate used to discount future cash flows is decreased, present value of the future cash inflows....

A) Increases

B) Decreases

C) Stays the Same

3) The ratio which many observers use to quantify the stock market's opinion of a firm is the....

A) ROE

B) EPS

C) D/E

D) P/E

E) None of the above

4) Compound rates, not discount rates, are used in an attempt to....

A) Screen out weak investments

B) quantify the firm's opportunity costs

C) Quantify the Firm's risk

D) A & B

E) None of the above

5) If Carla Rice puts $200 in the bank for nine years, and the money compounds at 7% annually, how much will Carla have at the end of the nine year period?

A) $362

B) $368

C) $374

D) $381

E) None of the Above

6) Adrian Ardell is saving for a new guitar. How much must Adrian set aside now to receive $4000, seven years from nowusing a compound interest rate of 7% annually?

A) $2400

B) $2491

C) $2411

D) $2500

E) None of the Above

7) Which of the following would be included among the investment numbers of a capital budget?

A) Purchase price of the asset

B) Trade - In - Value of an asset being replaced

C) Investment tax credit from acquistion

D) Installation costs of the Machinery

E) All of the above

8) Synergy between two companies

A) Is the complementary situation where value is created in the joining of the firms

B) May result in the improvement of the acquire's bottom line

C)Could be defined by purely qualitative benefits

D) A & C

E) A, B, & C

9) Gadsen acquires Digital corporation which is upstream in the marketing chain. This is an example of....

A) Diversification

B) Vertical Integration

C) Horizontal Integration

D) None of the Above

10) The cost of capital can be defined as

A) the weighted average cost of attracting investors to the firm

B) The price of obtaining funding for the firm, weighted according to target ratios in the capital structure

C) Less than the weighted average return that investors in the firm require

D) A & B

E) A, B,& C

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