Which of the following statements about the typical commercial umbrella policy is (are) true? I. The policy is designed to cover only those loss exposures specifically excluded by the underlying insurance contracts. II. The policy is excess over the required underlying coverages. A) I only B) II only C) both I and II D) neither […]
Under the Fair Credit Reporting Act (FCRA), if you have been denied credit, you have a right to A) inspect your credit file and have any errors or unsubstantiated entries corrected or removed. B) sue the credit bureau if your credit file indicates that you should have been granted credit. C) same response as b, […]
Pro forma estimates of cash flows are rarely if ever correct. Indicate whether the statement is true or false ANSWER TRUE
Which of the following choices will lead to a DECREASE in loan requirements? A) an increased age of accounts receivable B) an increased age of accounts payable C) a shortened age of inventory D) Each of the above will lead to a decrease in loan requirements. ANSWER C
What is the present value of an annuity of $4,000 received at the beginning of each year for the next eight years? The first payment will be received today, and the discount rate is 9% (round to nearest $1). A) $35,712 B) $24,132 C) $25,699 D) $36,288 ANSWER B
An employee of Nelson Manufacturing was injured by a defective machine Nelson purchased from Clark Corporation. The employee’s tort action against Clark was successful. Clark, in turn, sued Nelson, alleging that Nelson failed to provide proper operating instructions to the employee. This claim (Clark vs. Nelson) is covered under Part Two of Nelson’s workers compensation […]
In what important ways do financial managers and the accounting discipline interact? What will be an ideal response? ANSWER Financial managers deal with the management of working capital, capital structure decisions, and capital budgeting. In each of these a financial manager relies heavily on the development of accurate financial statements and the projection […]
Based solely on risk considerations, a mixed debt and equity firm does not have to worry about any financial obligations related to creditors. Indicate whether the statement is true or false ANSWER FALSE
In addition to the named insured, all of the following are insureds under the Commercial General Liability Policy EXCEPT A) suppliers of products to the named insured’s business. B) the insured’s employees while acting within the scope of their employment. C) the manager of the insured’s real estate. D) partners of the named insured. […]
Which of the following statements about workers compensation insurance is (are) true? I. Under the workers compensation part of the policy, the insurer agrees to pay the benefits required by the workers compensation law of any state listed in the policy declarations. II. The employers liability part of the policy provides workers compensation benefits when […]
