FINC 312

Which of the following are period costs?

General expenses, selling costs, administrative expenses

Liquitidy refers to the ease of changing

assets to cash

The use of financial leverage can

increase the chance of financial distress and business failure, increase the potential reward for investors, greatly magnify both gains and losses.

Long-term liabilities represent obligations of the firm lastings over

1 year

Operating cash flow includes capital spending and working capital requirements.

False

Net income refers to income earned

after interest and taxes

The statement of cash flow explains changes in

cash and equivalents

The cash flow identity reflects the fact that

cash flow from the firm's assets equals the total of cash flow to creditors and cash flow to stockholders, a firm generates cash through its various activities, cash is either used to produce the product or service, pay creditors or pay out to the owners of the firm.

The price at which willing buyers and sellers would trade is called _____ value

market

The accounting equation shows that stockholders' equity equal assets _____ liabilities

minus

Assets can be described as items that:

a firm owns, provide market value to the firm, generate revenue

Which of the following are classified as liabilities on a firm's balance sheet?

Notes payable, accounts payable.