1,

If Company A has a lower debt ratio than Company B, then Company A is likely to have __________ than Company B.

• a higher level of financial risk

• a greater ability to borrow

• more total assets

• less financial flexibility

2,

Under GAAP, how would dividends paid to company stockholders be accounted for on the statement of cash flows?

• As a decrease in cash flow from financing

• As an increase in cash flow from operations

• As an increase in cash flow from financing

• As a decrease in cash flow from investment