John has an auto which is covered for collision losses subject to a $250 deductible. Kate’s auto also has collision coverage but her deductible is $500. Which of the following statements describes how a $2,000 collision loss will be paid if it occurs when John borrows Kate’s car because his car is in the shop […]
Date: September 19th, 2020
Operating return on assets (OROA) is equal to operating profit margin times fixed assets turnover. Indicate whether the statement is true or false ANSWER FALSE
Date: September 19th, 2020
High Tech Corp. cut its research and development budget in 2010 by $4,000,000 in order to improve its cash flow for the year. Which of the following statements is MOST correct? A) The stock price will likely increase because the value of stock is based on reported cash flow. B) The change will have no […]
Date: September 19th, 2020
All of the following are covered autos under the liability section of the PAP EXCEPT A) a nonowned van which is driven by the insured on a regular basis. B) a trailer owned by the named insured. C) a borrowed auto used by the insured as a substitute for a stolen covered auto. D) a […]
Date: September 19th, 2020
If a company’s cash balance increases during the year, and the company also reports positive net income, then the company’s retained earnings balance must increase. Indicate whether the statement is true or false ANSWER FALSE
Date: September 19th, 2020
Larry has $25,000 of bodily injury liability coverage under his PAP. This limit is the minimum amount required by his state to be considered financially responsible. While on a vacation, Larry visited a neighboring state which has a minimum financial responsibility limit of $50,000 for bodily injury. Which of the following statements describes the situation […]
Date: September 19th, 2020
John occasionally borrows the car of his friend, Sophie. Sophie has a PAP with liability limits of 100/300/50. John also has a PAP, and his liability limits 250/500/50. John had an accident while using Sophie’s car and was found to be legally liable for $300,000 in bodily injury liability for injuries suffered by one person. […]
Date: September 19th, 2020
Another name for an asset’s expected rate of return is holding-period return. Indicate whether the statement is true or false ANSWER FALSE
Date: September 19th, 2020
Tim invested $1,000 in a mutual fund paying 8% per year. John invested $500 in the same fund. If both Tim and John keep their money invested for the same period of time, Tim will end up with twice as much money as John. Indicate whether the statement is true or false ANSWER […]
Date: September 19th, 2020
Fixed assets are assets whose balances will remain the same throughout the year. Indicate whether the statement is true or false ANSWER FALSE
Date: September 19th, 2020
