Based on the information in Table 4-2, the acid-test ratio is A) 2.15. B) 1.39. C) 1.33. D) 1.17. ANSWER D
Date: September 19th, 2020
It is your 6th birthday today. You have a trust fund with $50,000 that is earning 8% per year. You expect to withdraw $30,000 per year for 7 years starting on your 22nd birthday for graduate school. How much money will be left in the trust fund after your last withdrawal (rounded to the nearest […]
Date: September 19th, 2020
Which of the following statements about the businessowners policy is (are) true? I. It is designed to meet the insurance needs of large manufacturing firms. II. It is a package policy designed to meet the basic property and liability needs of an insured in a single contract. A) I only B) II only C) both […]
Date: September 19th, 2020
Use the following information to calculate the change in the company’s cash balance for the year. Credit Sales $800,000 Cash Sales $500,000 Operating Expenses on Credit $200,000 Cash Operating Expenses $700,000 Accounts Receivable (Beg. of Year) $50,000 Accounts Receivable (End of Year) $80,000 Accounts Payable (Beg. of Year) $50,000 Accounts Payable (End of Year) $100,000 […]
Date: September 19th, 2020
Ultimate ________ of a firm depends on who owns the major portion of the common shares and thus controls the direction of the firm through voting power. A) managerial control B) creditor control C) shareholder control D) government control ANSWER C Explanation: A)
Date: September 19th, 2020
A firm wishing to insure a single shipment of merchandise sent by a common carrier would purchase a(n) A) annual transit policy. B) trip transit policy. C) bailee’s liability policy. D) equipment floater. ANSWER Answer: B
Date: September 19th, 2020
Frank’s property insurance requires periodic reporting of inventory values. Frank believes he can save money by under-reporting the inventory. Last period, Frank reported $200,000 when the value was really $400,000. Shortly after filing the report, when the value was $500,000, the inventory was destroyed. Ignoring any deductible, how much will Frank’s insurer pay? A) nothing, […]
Date: September 19th, 2020
Which of the following statements about ocean marine insurance is true? A) The coverage is narrow and excludes perils of the sea. B) Hull insurance includes collision liability covering the ship’s owner if the ship collides with another ship. C) Protection and indemnity (P&I) insurance covers the shipper of goods for cargo losses. D) A […]
Date: September 19th, 2020
The process of determining the effects of one key variable on the overall outcome of a pro forma income statement, for example, is known as: A) ratio analysis. B) scenario analysis. C) sensitivity analysis. D) form analysis. ANSWER C
Date: September 19th, 2020
If management perceives the current market equity value of their shares to be OVER valued, then management should: A) issue new shares later after stock prices have come down so as not to further increase the price dilution found when issuing shares. B) issue new shares now to take advantage of the market mispricing, but […]
Date: September 19th, 2020
