1) Accounts payable is a A) Long-Term Asset. C) Current Asset. B) Long-Term Liability. D) Current Liability. 2) In 2009, an agricultural company introduced a new cropping process which reduced the cost of growing some of its crops. If sales in 2008 and 2009 were steady at $25 million, but the gross margin increased from 2.3% to 3.4% between those years, by what amount was the cost of sales reduced? A) $425,000 B) $275,000 C) $325,000 D) $575,000 3) GenCorp. has a total debt of $140 million and stockholders' equity of $50 million. It also has 26 million shares outstanding, with a market price of $4.00 per share. What is GenCorp's market debt-equity ratio? A) 1.35 B) 1.08 C) 0.67 D) 2.80 - 4 _ 4) Convex Industries has inventories of $218 million, current assets of $1.4 billion, and current liabilities of $504 million. What is its quick ratio? A) 2.35 B) 0.94 C) 2.81 D) 1.17 5 5) Manufacturer A has a profit margin of 2.2%, an asset turnover of 1.7 and an equity multiplier of 5.0. Manufacturer B has a profit margin of 2.5%, an asset turnover of 1.2 and an equity multiplier of 4.7. How much asset turnover should manufacturer B have to match manufacturer A's ROE? A) 2.23 B) 1.59 C) 3.18 D) 1.27 6) If the rate of interest (r) is 8%, then you should be indifferent about receiving $500.00 today or A) $540.00 in one year C) $500.00 in one year B) $462.96 in one year D) None of the above