spte 440

Which of the following is the rate of return required over and above the risk-free-rate? a.Risk of time b.Level of risk c.Risk premium d.Liquidity premium e.None of the above

c. risk premium

what financial statement tracks cash in and cash out of an organization over a specified period of time? a. balance sheet b. income statement c. statement of cash flows d. budget

c. statement of cash flows

Which of the following budgets allows management to forecast future requirements related to property, facilities, and major equipment? Revenue budget Expense budget Cash budget Capital expenditure budget Fixed asset budget

capital expenditure budget

The __________ forecasts how much cash the organization will have on hand and how much it will need to meet expenses. Revenue budget Expense budget Cash budget Capital expenditure budget Fixed asset budget

cash budget

In general, the changes of receiving back an investment in a large market Major League Baseball team is ______ that for a small market team. a.Less than b.Slighly less than c.Equal to d.Greater than e.None of the above

d. greater than

Which ratio measures how often an organization sells and replaces its inventory over a specified period of time? a.Current ratio b.Quick ratio c.Total Asset turnover ratio d.Inventory turnover ratio e.Debt ratio

d. inventory turnover ratio

An estimation of an organization's worth according to the stock market is __________. a.Interest coverage ratio b.Net profit margin c.Return on equity d.Market value e.Price-to-earnings ratio

d. market value

When using zero-based budgeting, each part of the organization in which budget decisions are made is referred to as a __________. Budget unit Finance unit Forcast unit Decision unit None of the above

decision unit

Which of the following is the depreciation method that is most aggressive at allocating loss of useful life to the early years of the asset's use? Straight-line Sum-of-years digits, decelerating depreciation Sum-of-years digits, accelerating depreciation Double-declining balance Units of production

double-declining balance

One source of risk is current economic conditions. Of the following, which is impacted by changes in current economic conditions? a.Capital finance b.Operating budgets c.League load pools d.Both a and b e.a, b, and c are all impacted

e. a, b, & c are all impacted

Which ratio measures how an organization finances its operation with debt and equity? a.Current ratio b.Quick ratio c.Total asset turnover ratio d.Inventory turnover ratio e.Debt ratio

e. debt ratio

Which of the following is an estimate of how much money investors will pay for each dollar of the organization's earnings? a.Interest coverage ratio b.Net profit margin c.Return on equity d.Market value e.Price-to-earnings ratio

e. price to earnings ratio

The __________ lists the primary activities undertaken by a unit to achieve its goals and allocate dollar amounts to each. Revenue budget Expense budget Cash budget Captial expenditure budget Fixed asset budget

expense budget

The vast majority of for-profit businesses in the United States operate as which of the following? Sole proprietorships General partnerships Subchapter S corporations Limited liability corporations C corporations

sole proprietorships

Which of the following methods of depreciation attempts to take the non-linear loss of a fixed asset's value into account with depreciation occurring late after purchase. Using this method, the denominator for a fixed asset with a useful life of five years is 15. Straight-line Sum-of-years digits, decelerating depreciation Sum-of-years digits, accelerating depreciation Double-declining balance Units of production

sum of years digits, accelerating depreciation

Which of the following methods of depreciation attempts to take the non-linear loss of a fixed asset's value into account, with depreciation occurring quickly after purchase. Using this method, the denominator for a fixed asset with a useful life of five years is 15. Straight-line Sum-of-years digits, decelerating depreciation Sum-of-years digits, accelerating depreciation Double-declining balance Units of production

sum of years digits, decelerating depreciation

This budgeting system requires starting the budgeting process with a zero base. Incremental budgeting Program planning budgeting systems Modified program planning budgeting systems Zero based budgeting Modified zero based budgeting

zero based budgeting

If it is expected that it will be hard to sell a security, which of the following will be added? a.Inflation risk premium b.Default risk premium c.Liquidity premium d.Maturity risk premium e.None of the above

c. liquidity premium

which of the following is a picture or snapshot of the financial condition of an organization at a specific point in time? a. balance sheet b. income statement c. statement of cash flows d. budget

a. balance sheet

Which ratio is an indication of whether an organization can meet its current liabilities―those due within a year―with its current assets? a.Current ratio b.Quick ratio c.Total asset turnover ratio d.Inventory turnover ratio e.Debt ratio

a. current ratio

which of the following is a profitability ratio that measures the percentage of an organization's total sales or revenues that was net profit or income? a. net profit margin b. return on equity c. market value d. price to earnings ratio

a. net profit margin

Risk increases as the length of time funds are invested increases. What is this known as? a.Risk of time b.Level of risk c.Risk premium d.Liquidity premium e.None of the above

a. risk of time

Which of the following measures the return rate an organization's owners or shareholders are receiving on their investments? a.Interest coverage ratio b.Net profit margin c.Return on equity d.Market value e.Price-to-earnings ratio

c. return on equity

Calculate the differences in total taxes paid if a $10,000 profit (that is disbursed to the shareholders) is realized for an S corp versus a C corp. Assume a 20% personal tax rate and a 20% corporate tax rate. Insert the difference between total amount of tax from C corp and total amount of tax from S corp (i.e., # C corp - # S corp). *Hints: S-corp (flow through taxation to the shareholder) C-corp (double taxation) tax = profit * tax rate *Note for answer format: insert number only (e.g., 1000 or 6000).

S corp - 10,000*.2 = 2,000 C corp - 10,000 * .2 = 2,000 8,000 * .2 = 1600 S = 2,000 C = 3600 3600-2000=1600

Which of the following is the nominal or quoted risk-free rate of interest? a.The real-risk free rate plus an inflation premium b.The real-risk free rate plus a default risk premium c.The real-risk free rate plus a liquidity premium d.The real-risk free rate plus a maturity risk premium e.None of the above

a. the real-risk free rate plus an inflation premium

The choices that individuals and organizations make regarding financial management are influenced by which of the following? Demand Scarcity Price Only a and c are correct All three-a, b, and c-are correct

all three are correct

Of the following, which is not an advantage of incremental budgeting? a. The budget is stable and change is gradual. b. The approach encourages managers to spend up to the budget to ensure that the budget is maintained the following year. c. Manager can operate their departments on a consistent basis. d. Coordination between budgets is easier to achieve. e. All of the above are advantages of incremental budgeting.

b. The approach encourages managers to spend up to the budget to ensure that the budget is maintained the following year.

For this type of bond, the annualized interest rate on the bonds is reset at auctions held every 7 to 35 days. a.General obligation bonds b.Auction-rate bonds c.Lease revenue bonds d.Revenue bonds e.All of the above

b. auction-rate bonds

The __________ shows the organization's income over a specified period of time. a.Balance sheet b.Income statement c.Statement of cash flows d.Budget e.None of the above

b. income statement

What is determined by comparing the risk of one asset to another? a.Risk of time b.Level of risk c.Risk premium d.Liquidity premium e.None of the above

b. level of risk

Which of the following was the first major professional sports team to declare bankruptcy in the middle of a long-term facility lease? a.New York Yankees b.Phoenix Coyotes c.Milwaukee Brewers d.San Francisco Giants e.New England Patriots

b. phoenix coyotes

The major disadvantages of forming a business under a _____ structure is that there is double taxation of profits, and the cost of forming the business and operating the business is higher than other structures. Sole proprietorships General partnerships Subchapter S corporations Limited liability corporations C corporations

c corporations

Last year's budget is increased or decreased by a percentage using this method of budgeting (a form of line-item budgeting). Incremental budgeting Program planning budgeting systems Modified program planning budgeting systems Zero based budgeting Modified zero based budgeting

incremental budgeting

When calculating the nominal interest rate, which of the following premiums is added to account for the risk of time and interest rate risk? a.Inflation premium b.Liquidity premium c.Default risk premium d.Maturity risk premium e.None of the above

maturity risk premium

Which of the following forms of budgeting is preferred in sport as it begins with a floor of expenses while also using cost behavior and cost identification techniques? Incremental budgeting Program planning budgeting systems Modified program planning budgeting systems Zero based budgeting Modified zero based budgeting

modified zero based budgeting

When the citizens of Hamilton County, Ohio, decided to raise their taxes to fund two new sports stadiums rather than to raise taxes for something like improving the educational system in the county, they missed a chance to improve the educational system. What is this known as? A marginal cost A fixed cost A variable cost An opportunity cost None of the above

opportunity cost

What is the interest rate that banks charge their best customers? Discount rate Federal funds rate Prime rate Statement rate None of the above

prime rate

This budgeting system is associated with output budgeting in which specific goals and objectives form the framework for a strategic, goal oriented budgeting process. Incremental budgeting Program planning budgeting systems Modified program planning budgeting systems Zero based budgeting Modified zero based budgeting

program planning budgeting systems

A __________ is a forecast because it is based on projecting future sales. Revenue budget Expense budget Cash budget Captial expenditure budget Fixed asset budget

revenue budget

When sport leagues do not expand into a market that can support a franchise, or when they create rules to limit the movement of existing franchises, which of the following economic concepts is being applied? Demand Scarcity Price Equilibrium None of the above

scarcity