Reference no: EM133087830

Questions -

Q1. Janex Corporation had OCF of $250, net capital spending of 5200 and change in networking capital of $150, Given this information, determine its cash low from assets?

A. $400

B. $800

C. $(400)

D. $(800)

E. $150

Q2. Dale Corporation had beginning fixed assets of $3,500 an ending fixed asset balance of $4,800 invested and depreciation expense of $200. Given this information, determine the net investment in fixed assets

A. $1,200

B. $1,300

C $1,400

D. $1,500

E. $1,600

Q3. Knight Insurance has shareholders' equity of $136,900. The firm owes a total of $71,400 of which 30% is payable within the next year. The firm has net fixed assets of $152,800. What is the amount of the net working capital?

A. $21,420

B. $25,300

C. $34,080

D. $46,720

E. $55,500

Q4. The owner of Fred's Electronics is trying to sell the business. The company built a building four years ago at a cost of $2.2 million. The building is currently appraised at $2.46 million. The firm's equipment originally cost $1.2 million and is currently valued at $700,000. The inventory is listed on the statement of financial position at $150,000 but is only worth $125,000. The owner expects to collect 90 % of the $300,000 in accounts receivable. The firm has $14,000 in cash and has total debt of $3.1 million. What is the market value of this firm?

A. $455,000

B. $469,000

C. $499,000

D. $504,000

E. $524,000

Q5. Freda's, Inc. has sales of $3,200, current liabilities of $900, total assets of $3,000, and net working capital of $500. How many dollars' worth of sales are generated from every $1 in net fixed assets?

A. $.91

B. $1.07

C. $1,67

D. $2.00

E. $2.29

Q6. During the year, The Train Stop decreased its accounts receivable by $60, increased its inventory by $130, and decreased its accounts payable by $20. For these three accounts, the firm has a net:

A. $90 use of cash.

B. $50 use of cash.

C. $170 use of cash.

D. $90 source of cash.

E. $50 source of cash.

Q7. A firm has sales of $500, total assets of $300, and a debt/equity ratio of 1. If its return on equity is 15%, what is its net income?

A. $7.50

B. $15.00

C. $22.50

D. $32.50

E. $50.00

Q8. The.............breaks down return on equity into three component parts: operating efficiency of the firm, its asset use efficiency, and financial leverage.

A. Du Pont identity

B. Return on assets

C. Statement of cash flows

D. Asset turnover ratio

E. Equity multiplier

Q9. Tellus and Rogers Corp. are close competitors. Last year, both had the same level of cost of goods sold, but Tellus turned its inventory over five times during the year while Rogers Corp. turned its inventory over every 65 days. If the objective is to keep inventory as low as possible (on average), which of the following is true?

A. Tellus did a better job since its inventory turnover was lower.

B. Rogers Corp, did a better job since its days' sales in inventory were lower.

C. Tellusa better job since its days' sales in inventory was lower.

D. Rogers Corp. did a better job since its inventory turnover was lower.

E. Tellus did a better job since its level of inventory was lower.

Q10. On the statement of cash flows, the change in current assets is listed in the section entitled:

A. Operating activity.

B. Merger activity.

C. Working activity.

D. Investment activity.

E. Financing activity.

Q11. You are scheduled to receive $18,000 in five years, When you receive it, you will invest it for five more years at 8.6% per year. How much will you have at the end of this time? What would be an equivalent Present Value?

A. $15,916

B. $14,916

C. $13,916

D. $12,916

E. $11,916

Q12. Alexander Industries just had a very profitable year. The owner has decided to invest $225,000 of the profits in a venture that pays an 8% rate of return for fifteen years. How much more would the investment have been worth if the owner could have made 9% on this investment?

A. $52,910.25

B. $105,820.50

C. $211,641.00

D. $713,738.05

E. $819,558.55

Q13. You are scheduled to receive $30,000 in three years. When you receive it, you will invest it for seven more years at 5.5% per year. How much will you have at the end of this time? What would be an equivalent Present Value?

A.$29,548

B. $28,548

C. $27.548

D. $26,548

E. $25,548

Q14. Many economists view a 3% annual inflation rate as "acceptable". Assuming a 3% annual increase in the price of automobiles, how much will a new Suburban cost you five years from now, if today's price is $48,000?

A. $41,405

B. $48,000

C. $54,024

D. $55,200

E. $55,645

Q15. You set up an educational savings plan that will pay $15,000 to your newborn child in 18 years. If the plan uses a rate of 4.75% per year, what was contributed to this plan?

A. $4,459

B. $5,800

C. $6,506

D. $7,007

E. $8,576