A fire destroyed the home next door to Brad’s home. The fire department chief was concerned that the damaged home would collapse on to Brad’s home, so he ordered Brad to evacuate his home. Which of the following statements is true concerning the cost of Brad’s hotel room while he is complying with the fire […]
Date: September 19th, 2020
If there is a conflict between state law and a provision in a homeowners policy, A) the policy wording takes precedence. B) the state law takes precedence. C) the policyholder is entitled to whichever provides broader coverage. D) the policy is null and void. ANSWER Answer: B
Date: September 19th, 2020
One additional coverage under the homeowners policy makes available up to 10 percent of the Coverage A limit to cover increased repair costs after a loss in order to comply with a stricter building code. This additional coverage is called A) ordinance or law. B) reasonable repairs. C) concurrent causation. D) debris removal. […]
Date: September 19th, 2020
When comparing inventory turnover ratios, other things being equal, A) higher inventory turnover results from old or obsolete inventory increasing the inventory balance on the balance sheet. B) a higher inventory turnover is preferred to improve liquidity. C) higher inventory turnover results from an increase in the selling price of the product. D) a lower […]
Date: September 19th, 2020
Following catastrophic hurricane losses, South Coast Insurance Company changed its deductible provision. Rather than using a specified dollar value, $250 for example; the dollar value of the deductible increases with the size of the loss. The type of deductible that South Coast changed to is called a(n) A) calendar-year deductible. B) aggregate deductible. C) straight […]
Date: September 19th, 2020
Cash and credit management are typically the responsibility of the A) treasurer. B) vice president of production and operations. C) controller. D) chief executive officer, or CEO. ANSWER A
Date: September 19th, 2020
The homeowners policy excludes a loss brought about by two or more perils where one peril is covered under the policy and the other perils are excluded. This situation is called A) ordinance or law. B) proximate cause. C) concurrent causation. D) nullification. ANSWER Answer: C
Date: September 19th, 2020
Given the following financial statements for ACME Corporation, what amount did the company pay in dividends for 2010? Income Statement Balance Sheet Year Ended 12/31/10 12/31/2010 12/31/2009 Sales $1,300,000 Current Assets $50,000 $45,000 Cost of Goods Sold 750,000 Gross Fixed Assets 880,000 650,000 Operating Expenses 200,000 Less Accumulated Depreciation 450,000 350,000 Depreciation Expense 100,000 Fixed […]
Date: September 19th, 2020
Several different values can be considered when determining how much insurance should be carried on a dwelling (the Coverage A limit of the Homeowners 3 policy). The appropriate value that should be used is: A) the home’s market value. B) the home’s actual cash value. C) the home’s appraised value for property tax purposes. D) […]
Date: September 19th, 2020
Which of the following statements is (are) true regarding how the Homeowners 3 policy handles the peril of collapse? I. Collapse is specifically excluded, and there are no exceptions to the exclusion. II. Collapse that is caused by a Coverage C peril is covered. A) I only B) II only C) both I and II […]
Date: September 19th, 2020
