The overriding objective of the capital structure decision should be to choose the level of debt that results in the largest possible share price. Indicate whether the statement is true or false ANSWER TRUE
Date: September 19th, 2020
A USE of cash is interest payments received. Indicate whether the statement is true or false. ANSWER Answer: FALSE Explanation: A use of cash is interest payments MADE.
Date: September 19th, 2020
The sales for October, November and December are $10,000, $12,000 and $18,000, respectively. For any particular month of sales, the following percentages are received over time in cash: 20% in cash from that same month of sales; 50% in cash from the previous month’s sales; and, 30% in cash from the sales from two months […]
Date: September 19th, 2020
If we assume that EBIT is constant, the value of a firm is maximized by minimizing the weighted average cost of capital. Indicate whether the statement is true or false ANSWER TRUE
Date: September 19th, 2020
As with a lot of planning, the financial forecast begins with ________ estimates and ________ schedules. A) sales; production B) sales; profit C) dividends; production D) profits; dividend ANSWER Answer: A
Date: September 19th, 2020
Short-term decisions are viewed as decisions that have short-term impacts and can be changed or modified at ________. A) relatively low costs B) relatively high costs C) relatively high time requirements D) relatively low costs with high time requirements ANSWER Answer: A
Date: September 19th, 2020
As financial leverage increases, the cost of debt initially remains constant and then rises, while the cost of equity always rises. Indicate whether the statement is true or false ANSWER TRUE
Date: September 19th, 2020
Southwest Outdoor Store will have cash receipts of $47,000 in November and cash disbursements of $41,000 for this month. If its beginning cash is $7,000 and its desired reserve is $4,000, what will its excess be for December? A) There is no excess but a shortfall. B) $6,000 C) $9,000 D) $13,000 ANSWER […]
Date: September 19th, 2020
For August, Bletchley Blinds will have cash receipts of $97,000 and cash disbursements of $108,000. If its beginning cash is $5,000 and its desired reserve is $2,000, what will be its shortfall in cash for the month? A) There is no shortfall in cash but an excess of cash. B) -$11,000 C) -$8,000 D) -$6,000 […]
Date: September 19th, 2020
For April, Anderson Antiques will have cash receipts of $365,000 and cash disbursements of $370,000. If its beginning cash is $4,000 and its desired reserve is $3,000, what will be its shortfall in cash for the month? A) There is no shortfall in cash but an excess of cash. B) -$3,000 C) -$4,000 D) -$5,000 […]
Date: September 19th, 2020
