A bond that guarantees that the person responsible for the property of another will faithfully exercise his or her duties is called a A) fiduciary bond. B) performance bond. C) court bond. D) contract bond. ANSWER Answer: A
Date: September 19th, 2020
Which is NOT a characteristic of a limited liability partnership? A) One or more of the partners must be a general partner to whom the privilege of limited liability does not apply. B) Prohibits the limited partners from participating in the management of the partnership. C) Partners pay taxes on dividends distributed. D) One or […]
Date: September 19th, 2020
Which of the following represents the correct ordering of standard deviation of returns over the period 1926 to 2014 (from highest to lowest standard deviation of returns)? A) common stocks, long-term government bonds, long-term corporate bonds, Treasury bills B) Treasury bills, long-term government bonds, long-term corporate bonds, common stocks C) Treasury bills, long-term government bonds, […]
Date: September 19th, 2020
You are going to pay $100 into an account at the beginning of each of the next 40 years. At the beginning of the 41st year you buy a 30 year annuity whose first payment comes at the end of the 41st year (the accounts earn 12%). How much will you receive at the end […]
Date: September 19th, 2020
Gaston Grooming Inc., has a sustainable growth rate of 17.28%. If the retention ratio is .60, the leverage ratio is 1.2 and the asset turnover ratio is 1.6, what was the firm’s profit margin? A) 15.0% B) 13.6% C) 12.1% D) 11.4% ANSWER A Explanation: A) PM = SGG/(ATO * LR * b) […]
Date: September 19th, 2020
A stock’s beta is a measure of its A) diversifiable risk. B) systematic risk. C) unsystematic risk. D) company-unique risk. ANSWER B
Date: September 19th, 2020
You are going to pay $800 into an account at the beginning of each of 20 years. The account will then be left to compound for an additional 20 years until the end of year 40, when it will turn into a perpetuity. You will receive the first payment from the perpetuity at the end […]
Date: September 19th, 2020
Which of the following statements about International Financial Reporting Standards (IFRS) is NOT true? A) IFRS offers simplicity but also possibly more leeway for accounting malpractice than does GAAP. B) In 2008, the Securities and Exchange Commission (SEC) announced its plan to convert U.S. companies from GAAP to IFRS. C) IFRS sets out broad and […]
Date: September 19th, 2020
Gremlin Media Inc. has realized tremendous growth in recent years. Last year the firm realized an ROE of 41.16%. If the firm was in a 40% marginal tax bracket, had an asset turnover ratio of 2.1, a profit margin of 14%, and a leverage ratio of 2, what was the firm’s retention ratio? A) 0.70 […]
Date: September 19th, 2020
Jack, owner of Jack’s Bar and Grill, was robbed while attempting to deposit receipts at his bank’s night depository. Jack had purchased an ISO commercial crime coverage form. This loss would be covered under which insuring agreement? A) Inside the Premises—Theft of Money and Securities B) Outside the Premises C) Money Orders and Counterfeit Currency […]
Date: September 19th, 2020
