Test bank accounting management 11e chapter 13 STRATEGY, BALANCED SCORECARD, AND

... 15.60% 13. 64% Chapter 13 - Page 14 Optimal capital structure and Hamada equation 48 Answer: d Diff: T Aaron Athletics is trying to determine its optimal capital structure The company’s capital structure ... EPS between capital structure A and capital structure B is $6.04 - $3.17 = $2.87 56 Capital structure, leverage, and WACC Answer: d Diff: T N You need t...

Ngày tải lên: 22/11/2016, 11:02

... of the statements above are correct e None of the statements above is correct Medium: Business ethics 21 Diff: M Which of the following is an example of an area of business in which the use of ... capital in part because of the other disadvantages of the partnership form of business, including impermanence of the organization e A major disadvantage of a partnership as a...

Ngày tải lên: 22/11/2016, 11:00

... DEP and AMORT, but OCF would go up by DEP and AMORT, so the net change to OCF would be: DEP and AMORT – (DEP and AMORT)(1 - T) = DEP and AMORT – (DEP and AMORT) + (DEP and AMORT)(T) = (DEP and ... declined The company had an increase in its noncash revenues Statements a and b are correct Statements b and c are correct Net cash flow, free cash flow, and cash Diff: E...

Ngày tải lên: 22/11/2016, 11:01

... have a higher net income than Company B All of the statements above are correct None of the statements above is correct Chapter - Page Financial statement analysis 12 Company A has a higher Company ... earning power ratio d All of the statements above are correct e Statements a and c are correct Financial statement analysis 22 Answer: a Diff: M Which of the following...

Ngày tải lên: 22/11/2016, 11:01

... interest rates will decline Prices and interest rates will both decline Prices will decline and interest rates will rise There will be no changes in either prices or interest rates Chapter - Page Financial ... in years, and so on) a If 2-year rates exceed 1-year rates, then the market expects interest rates to rise b If 2-year rates are percent, and 3-ye...

Ngày tải lên: 22/11/2016, 11:01

... decline Chapter - Page Portfolio risk and return 15 Answer: b Diff: E Stock X has a beta of 0.7 and Stock Y has a beta of 1.3 The standard deviation of each stock’s returns is 20 percent The returns ... Statements a and c are correct e Statements b and c are correct SML 29 Answer: c Stock A has a beta of 1.2 and a standard deviation of 20 percent Stock B has a beta...

Ngày tải lên: 22/11/2016, 11:01

... present value of the annuity due exceeds the present value of the ordinary annuity, while the future value of the annuity due is less than the future value of the ordinary annuity c The present value ... correct? a The present value of the ordinary annuity must exceed the present value of the annuity due, but the future value of an ordinary annuity may be less th...

Ngày tải lên: 22/11/2016, 11:02

... perspective of the firm’s management d Chapters 11 and are the most important bankruptcy chapters for financial management purposes If a reorganization plan cannot be worked out under Chapter 11, then ... coupon bonds mature on December 31, 2022, and it is now January 1, 2003 Interest on these bonds is paid annually on December 31 of each year, and new annual coupon bonds wi...

Ngày tải lên: 22/11/2016, 11:02

... Stock X and Stock Y have the same dividend yield So, statements a and b are incorrect That also makes statements d and e incorrect Since both stocks X and Y have the same price today, and Stock ... year from now, the two stocks are expected to trade at the same price d Statements a and b are correct e Statements a and c are correct Chapter - Page Constant growth model and...

Ngày tải lên: 22/11/2016, 11:02

... b The cost of debt used to calculate the weighted average cost of capital is based on an average of the cost of debt already issued by the firm and the cost of new debt c One problem with the ... measure of the before-tax cost of capital b Typically the after-tax cost of debt financing exceeds the after-tax cost of equity financing c The...

Ngày tải lên: 22/11/2016, 11:02

... cash flows of $5,000,000 at the end of each of the next years However, the facility will have to be repaired at a cost of $6,000,000 at the end of the second year Thus, at the end of Year there will ... cash flows of $500,000 at the end of each of the next 20 years However, repairs that will cost $1,000,000 must be incurred at the end of the 10th year T...

Ngày tải lên: 22/11/2016, 11:02

... the analysis, while sunk costs should not be included 27 Incremental cash flows Answer: d Diff: M 28 Incremental cash flows Answer: d Diff: M 29 Cash flow estimation Answer: b Diff: M 30 Cash flow ... incremental cash flows, and therefore, relevant cash flows e None of the statements above is an example of an incremental cash flow Chapter 11 - Page Incremental ca...

Ngày tải lên: 22/11/2016, 11:02

... earnings of $100,000 and pays out 50% or $50,000 in dividends, then it will retain earnings of $50,000 The retained earnings breakpoint is $50,000/0.4 = $125 ,000 Since it will require financing in ... a An increase in the time remaining until the real option must exercised b An increase in the volatility of the underlying source of risk c An increase in the risk-free rate d An incr...

Ngày tải lên: 22/11/2016, 11:02

... 100 shares of stock, and the stock will trade at or near 50 shares of stock, and the stock will trade at or near 50 shares of stock, and the stock will trade at or near Chapter 14 - Page Stock repurchases ... $60 a share c You will have $60 a share d You will have $120 a share e You will have $60 a share 200 shares of stock, and the stock will trade at or near 200 shares...

Ngày tải lên: 22/11/2016, 11:02

... the firm’s tax rate is 40 percent With a restricted policy, current assets will be 15 percent of sales Under a relaxed policy, current assets will be 25 percent of sales What is the difference ... 1.00% 0.50% 0.33% Chapter 15 - Page 17 CHAPTER 15 ANSWERS AND SOLUTIONS Working capital Working capital Answer: c Answer: d Diff: E Diff: E N The correct answer is statement d The...

Ngày tải lên: 22/11/2016, 11:02