Fin Management- Exam 1
Which of the following is the correct representation of the total debt ratio?
(total assets-total equity)/total assets
BT Tools has current assets totaling $9.2 mil, including 4.3 mil in inventory. The Company''s current liabilities total 8.1 mil. What is the quick ratio?
.60 (9.2-4.3)/ 8.1
Assume current Assets =$48; fixed assets = $215, current liabilites = $42 and equity = $100. What is the total debt ratio?
0.42
A firm has an operating profit(EBIT) of $600 on sales of $1,000. Interest expense is $250 and taxes are $120. What is the times interest earned ratio?
2.40 ( $600/$250 = 2.40
Omega Co. has annual sales of $250,000, costs of goods sold of $168,000, and assets od $322,000. , accounts receivable are 86,200 what is the recievables turnover?
2.9
How are firms classified into peer groups for ratio analysis?
According to Standard Industrial Classification codesSome of the types of cash flow generated by a firm goes back to the financial markets in the form of? dividends and debt payments
Which of the following can be used to encourage managers to act in the best interests of shareholders?
Better prospects of promotion and managerial conpensation tied to performance
True or false? Shareholders are the only stakeholder in a firm?
FALSE
In a large corporation, the financial manager is primarily responsible for?
Financial aspects, financing decisions, and long term investments
what should be kept in mind when examining the income statement?
GAAP, time and costs, cash vs. non-cash items
fixed costs are costs that will not change :
In the short run.
What is an IPO?
Initial Public Offering
Which of the following are included in a firm's capital structure?
Long-term debt and equity.
capital budgeting is concerned with planning and managing a firm's
Long-term investments
What is the NYSE?
New York Stock Exchange
True or false? The interval measure iindicates how long a start-up company can operate until it needs more financing?
TRUE
The EBITDA ratio is similar in spirit to the :
The PE Ratio
free cash flow is better described as _________
Total distributable cash flow
Which of the following are period costs?
admin expenses, general expenses, selling costs
Net income refers to money earned _________.
after interest and taxes
What is a secondary market?
are those in which these securities are bought and sold after the original sale.
The short run is a period when there are _______ costs?
both fixed and variable
whichh of the following show why a corporation is the most important form of business?
can enter contracts, can sue and be sued, can exchange and a property
accounting profit ______ cash flow.
differs from
cash flow to stockholders equals
dividends paid minus net new equity raised
A TIE ratio of 3.5 times means a firm has __________ that is 3.5 times greater than the firm's interest expense.
earnings before interest and taxes
In financial markets, debt and ________ securities are bought and sold.
equity
costs that do not change in the short run arise because of
fixed commitments
The inventory turnover ratios for proctor and gamble over the past three years are 5.09, 5.72 and 5.92 times respectively. Explain the trend requires
further investigation
Which of the following are considered stakeholders in a company?
government, suppliers, and employees
increasing its non-cash liquid assets will ebnable a firm to do which of the following?
increase it's ability to avoid financial distress, increase it's ability short term-obligations
Period costs are the costs that are allocated to a specific
interval of timeWhat is a financial market?
What is an example of a secondary market?
involves one owner or creditor selling to another.
If a compnay has inventory, the quick ratio will always be ________ the curent ratio?
less than
A treasurer's reponsibilities typically include
managing capital expenditure decisions, making financial plans, handling cash flows
an income statement reflects activity that occurs _____ while a balance sheet reflects values _____
over a period of time; as of a specific date
what are the two classifications of costs used by financial accountants?
period and product costs
Which of the following are traditional financial ratio categories?
profitability,market value and asset management ratios
Which of these are generall considered short-run fixed costs?
property taxes, management salaries, rent payments
What is an example of a primary market?
public offerings and private placements
What is a primary market?
refers to the original sale of securities by governments and corporations.
A _________ is someone other than an owner or creditor who potentially has claim of the cash flows of a firm.
stakeholder
The officer responsible for managing the firm's cash flows is the _________
treasurer
in the long run all costs are
variable