CH 02 HW

The book value of a firm is:

based on historical transactions

Which one of the following is classified as a tangible fixed asset?

computer equipment

which one of the following financials statements summarizes a firms revenue and expenses during a period of time?

income statement

Which one of the following accounts is the most liquid?

Accounts Receivable

Which one of the following is a current liability?

An invoice payable to a supplier in 45 days

Which one of the following is the financial statement that shows the accounting value of a firm's equity as a particular date?

Balance Sheet

Which one of the following determines the standards and procedures with which audited financial statements are prepared?

Generally Accepted Accounting Principles (GAAP)

Which one of the following is classified as a current asset?

Inventory

Which one of the following is most likely to be a fixed cost?

Rent

A positive cash flow to stockholders indicates which of the following with certainty?

The dividends paid exceeded the ent new equity raised

Which one of the following must be true if a firm had a negative cash flow from assets?

The firm obtained external funding

Total income taxes divided by the total taxable income equals the _______________ tax rate

average

The cash flow that is available for distribution to a corporations creditors and stockholders is called the

cash flow from assets

The cash flow related to interest payments less any net new borrowing is called the:

cash flow to creditors

Which one the following describes a noncash item?

expenses that do not consume cash

Cash flow from assets is also known as the firm's:

free cash flow

The ___________ tax rate is the percentage of the last dollar you earned that must be paid in taxes

marginal

The cash flow that results from a company's ongoing, normal business activities called:

operating cash flow