You are on page 1of 5

Question 1

1. The difference between the present value of the financial benefits that will be received from a project and the present value of the financial costs of that project is the: Answer internal rate of return. stream of cash flow. annuity spread. net present value. 4 points

Question 2
1. __________ are short-term, low risk investments that can be easily sold and converted to cash. Answer Current assets Securities inventory Stock options Marketable securities 4 points

Question 3
1. The newest form of business organization that combines the positive features of corporations with the positive features of partnerships is the: Answer

S corporation. sole proprietorship. limited partnership. limited liability company 4 points

Question 4
1. The difference between the nominal interest rate and the real interest rate is the: Answer rate of return. risk factor. inflation rate. yield curve. 4 points

Question 5
1. __________ is the financial statement that provides a snapshot of the corporation's financial position at a specific time. Answer An income statement A statement of cash flow A balance sheet A statement of financial condition 4 points

Question 6

1. A corporate form of doing business that requires shareholders to pay the income tax owed by the corporation is a: Answer tax-exempt corporation. limited liability company. S corporation. non-profit corporation. 4 points

Question 7
1. The difference between a firm's current assets and current liabilities that represents the capital available in the sort-term to run the business of the firm is called: Answer an intangible asset. depreciation. net working capital. operating income. 4 points

Question 8
1. Market value of a firm's equity divided by the book value of the firm's equity equals the: Answer net profit margin. EBIT margin.

market-to-book ratio. book-to-market ratio. 4 points

Question 9
1. The financial statement that details a firm's revenues and expenses over a stated period of time is the: Answer balance sheet. income statement. cash flow statement. revenue and expense sheet. 4 points

Question 10
1. A __________ distinguishes income and expenses related to operations from investment and financing activities. Answer balance sheet operating statement income statement statement of cash flow 4 points

Question 11
1.

What are the differences between regular of C corporations and S corporations? Under what circumstances would an S corporation be a better choice for the operation of a business than a C corporation?

You might also like