Which of the following statements about the condominium commercial-unit owners coverage form is (are) true? I. It provides coverage for the unit owner’s proportionate financial interest in the condominium building. II. It provides coverage for the business personal property of the unit owner. A) I only B) II only C) both I and II D) […]
You are 21 years old today. Your grandparents set up a trust fund that will pay you $25,000 per year for 20 years, starting on your 65th birthday to supplement your retirement. If the trust can earn 7.5% per year, how much will your grandparents need to put in the trust fund today (rounded to […]
Based on the information in Table 4-1, and assuming the company’s stock price is $30 per share, the P/E ratio is A) 9.85. B) 10.99. C) 3.09. D) 4.83. ANSWER B
All of the following statements about business income insurance are true EXCEPT A) Business income is defined as total sales that would have been made if the loss had not occurred. B) Payroll is considered a continuing normal operating expense. C) Business income insurance does not cover the physical damage caused by a peril which […]
Which of the following statements about the business income coverage form is true? A) Business income is defined as gross earnings before taxes. B) Payroll is excluded unless it is specifically added. C) The form covers loss of business income and extra expenses incurred during restoration. D) The form can be used by a manufacturing […]
Which of the following statements about the equipment breakdown protection coverage form is (are) true? I. The covered cause of loss is a breakdown of covered equipment, including boilers, machinery, and electrical and mechanical equipment. II. It provides coverage for the reasonable cost of expediting permanent repair or replacement of damaged property. A) I only […]
The interest coverage ratio is equal to: A) EBIT/interest. B) interest/EBIT. C) (debt + equity)/EBIT. D) EBIT * interest. ANSWER A
Based on the information in Table 3-1, the change in cash for 2010 is A) $4,000. B) $4,950. C) $5,500. D) $5,800. ANSWER D
Based on the information in Table 3-1, calculate the after-tax cash flow from operations for 2008 (no assets were disposed of during the year, and there was no change in interest payable or taxes payable). A) $1,450 B) $5,500 C) $4,300 D) $6,250 ANSWER C
Based on the information in Table 4-1, the inventory turnover ratio is A) 1.3 times. B) 2.5 times. C) 2.0 times. D) 2.9 times. ANSWER C
