An armed robber pulled a gun on a teller at the Fourth National Bank. He made off with over $10,000 in cash. Which insuring agreement in a financial institution bond is designed to cover such losses? A) Insuring Agreement A—Fidelity B) Insuring Agreement B—On Premises C) Insuring Agreement C—In Transit D) Insuring Agreement D—Forgery or […]
Page Litton likes to use her credit card to buy gas since she can defer payment for 30 days. However, she notices that her dealer charges 3 cents more per gallon than if she paid with cash. Page estimates paying about $1. 00 a gallon for gas, and her monthly credit statement shows an APR […]
A Pony Express Armored Car was transporting bank receipts from six branch banks to the main bank. A group of robbers staged a daring robbery. They forced the armored car off the road, shot two guards, and took over $120,000 in cash. Which insuring agreement in a financial institution bond would cover the stolen money […]
Which type of business organization is subject to initial legal requirements? A) Sole proprietorship B) Limited liability corporation C) “C” corporation D) None of the above ANSWER C
What are the primary differences among a sole proprietorship, a partnership, and a corporation? What will be an ideal response? ANSWER The sole proprietorship is a business operation owned and managed by an individual. Initiating this form of business is simple and generally does not involve any substantial organizational costs. The proprietor has […]
Smith is Manager of ABC Department Store. Jones, ABC’s Security Director, visited Smith to ask some questions. During questioning, Smith admitted that he stole $10,000 in merchandise. He was disciplined, but not fired. The loss was not reported to the insurer that wrote ABC’s crime insurance. Six weeks later, Smith was observed on a surveillance […]
Fifth National Bank decided to loan $200,000 to Fred Franklin. As collateral for the loan, Fred posted stock certificates. When Fred defaulted on the loan, Fifth National tried to sell the stock. They discovered the stock certificates were stolen from someone else. Which insuring agreement in a financial institution bond is designed to cover such […]
Optimal capital structure “first” criteria suggests that THE IMPACT ON EPS should be ________ and that the best way to obtain that is with ________ levels of debt and ________ levels of equity. A) high; low; high B) low; high; low C) high; high; low D) low; low; high ANSWER D
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) […]
A stock’s beta is a measure of its A) diversifiable risk. B) systematic risk. C) unsystematic risk. D) company-unique risk. ANSWER B
