A company has an accounts payable period of 58 days, a collection period of 28 days, and a cash conversion cycle of 43 days. Calculate the operating period. A) 15 B) 101 C) 86 D) 30 E) 28 ANSWER B
Date: September 19th, 2020
When financial ratios are compared to financial ratios from previous years, a ________ is conducted. A) cross-time B) SIC code C) time series D) cross-sectional E) None of the above ANSWER C
Date: September 19th, 2020
All of the following are problems with cross-sectional financial analysis EXCEPT that A) an industry may be dominated by a few firms. B) annual reports sometimes do not disclose divisional financial data. C) many firms are conglomerates. D) it provides no basis for comparison to other firms. E) there may be no obvious firms to […]
Date: September 19th, 2020
Acme Explosives Inc is an international producer of creative demolition products. Selected financial information for Acme is provided in the table below. Acme wants to distribute all of its cash with an open market repurchase. Assume that Acme is able to buy back 1,064,377,778 shares for an average price of $27 per share. What is […]
Date: September 19th, 2020
Kaiser Shipyards Inc. is San Francisco-based ship builder which specializes in Liberty and Victory class cargo ships. The CEO, Henry Kaiser, wants to distribute $1B of cash using an open market stock repurchase. Assume that the company repurchases 11.650% of shares outstanding at a price of $62.725. What is the stock price after the repurchase? […]
Date: September 19th, 2020
Frank’s Franks posted a cost of goods sold of $5,000 and had an average payables of $125. Calculate the Accounts Payable Period. A) 10.2 B) 9.125 C) 13.41 D) 7.65 E) 8.54 ANSWER B
Date: September 19th, 2020
Willys-Overland Motors Inc. produces 4×4 quarter-ton trucks. Selected financial information for Willys-Overland is provided in the table below. The CEO, John Willys, wants to distribute $1B of cash using a stock repurchase. He intends to repurchase 15 million shares at a price of $70. Mr. Willys owns 22.5 million shares (worth $1,395 million before the […]
Date: September 19th, 2020
Wayne’s Wax World has an inventory turnover of 16 times per year and a cost of goods sold of $1,600. Calculate the average inventory turnover. A) 22.81 B) 1,000 C) 4.38 D) 13.92 E) 14.25 ANSWER A
Date: September 19th, 2020
You are evaluating two projects. You may accept only one of them. Project one will cost $379,000 initially and will pay $134,000 each year for the next 5 years. Project two will cost $454,000 initially, but will pay $101,000 for the next 10 years. The firm’s cost of capital is 15%. Compute the NPV of […]
Date: September 19th, 2020
Foreign currency trading A) takes place on organized exchanges. B) mostly entails small transactions. C) volume averages less than $1 billion per day. D) is conducted in less-than-competitive markets. E) takes place in markets similar to OTC stock markets. ANSWER E
Date: September 19th, 2020
