1. Solid State, Inc. has a total equity of $560,000; sales of $2,250,000; total assets of $995,000; and current liabilities of $310,000. What is Solid State's debt ratio? A. 66.7% B. 31.2% C. 43.7% D. 55.4% Your answer is accepted. 2. If you invest RM750 every six months at 8 percent compounded semi-annually, how much would you accumulate at the end of 10 years? A. RM21,731 B. RM22,334 C. RM10,065 D. RM10,193 3. You are planning to buy a new computer which cost RM5,000. You intend to pay cash in 2 years time and you can earn 8% on your money, how much money should you set aside today in order to make the payment when due in two years? A. RM 4,286.69 B. RM 3,675.00 C. RM 5,349.90 D. RM 2,570.50 Your answer is accepted. 4. Which principle is referring to the statement: 'Managers won't work for the owners unless it is in their best interest. Managers may make decisions that are not in line with the goal of maximization of shareholder wealth'. A. Ethical Behavior Is Doing the Right Thing, and Ethical Dilemmas Are Everywhere in Finance B. The Curse of Competitive Markets C. All Risk is Not Equal D. The Agency Problem 5. Math Tools Inc. has a current ratio equal to 2 , a quick ratio equal to 1.2 , and total current assets of RM1 million. Math Tool's inventory balance is A. RM800,000 B. RM1,400,000 C. RM400,000 D. not determinable with the information given Your answer is accepted. 6. Anton's Coffee Shop has a return on assets of 12%. Anton's assets =$100 while Anton's owner's equity =$40 and its debt equals \$60. What is Anton's return on equity? A. 18% B. 20% C. 12% D. 30% 7. An electrical company has guaranteed that the price of a new LCD TV will always be RM25,000. Currently you have only RM13, 506.94 and you interested to buy the LCD. At what rate must your RM13, 506.94 be compounded annually for it to grow to RM25,000 if it invested at 8 years? A. 6% B. 5% C. 8% D. 7% Your answer is accepted. 8. Which of the following statement is right? A. Finance is how individuals, businesses, and organizations acquire and utilize capital while accounting is to preparing budget cost allocation cost reduction. B. Finance is a book keeping and accounting is recording daily activities. C. Finance is about daily records while accounting is about fund investment D. Finance is how individuals, businesses, and organizations acquire and utilize capital while accounting is to records the transfer of money. 9. What is the future value of RM500 invested at 8% compounded quarterly for 12.5 years (round to nearest RM1)? A. RM9,486 B. RM670 C. RM1,259 D. RM1,346 Your answer is accepted. 10. Which of the following statements are NOT roles and responsibilities of Financial Managers? A. Recruiting and monitoring staff in finance department. B. Forecasting and planning for the company future. C. Investment and financing decision by determining the optimal sales growth rate, capital expenditure, types of assets, etc. D. Coordination and control by interacting with the non-financial managers to ensure that the operation of the firm is harmonized. 11. All of the following are Income Statement items accept for: A. Depreciation B. Cost of goods sold C. Interest expense D. Inventories Your answer is accepted. 12. Which of this statement shows the advantage to form a corporation? A. Control of corporation not guaranteed by partial ownership of stock B. Ability to raise large amounts of capital is increased C. Owner must absorb all losses D. Business terminates immediately upon death of owner Your answer is accepted. 13. If an investor were to sell 100 shares of Microsoft stock to another investor in the securities market, this would be referred to as what type of transaction? A. A futures market transaction B. A primary market transaction C. A money market transaction D. A secondary market transaction Your answer is accepted. 14. You want RM20,000 in 5 years to take your spouse on a second honeymoon. Your investment account earns 7\% compounded semiannually. How much money must you put in the investment account today? (round to the nearest RM1). A. RM12,367 B. RM13,349 C. RM15,985 D. RM14,178 15. The purpose of financial statement analysis is: A. It is prepared mainly for raising funds and for tax purpose. B. Relies on generally accepted accounting principles to make a comparison between companies valid. C. Use the financial statements and is thus only to assess past performance. D. Uses the financial statements to measure a company's performance and future projection. Your answer is accepted. 16. Capital market instruments include A. Treasury bills B. Corporate equities C. Negotiable certificates of deposit D. Commercial paper 17. Money market instruments include: A. T-bonds. B. Common stock. C. T-bills. D. Preferred stock. Your answer is accepted. 18. Which of the following statement is CORRECT about the two approaches to measure the liquidity of the firm? A. Measure how much investors are willing to pay for \$1 of reported earnings. B. Examines the amount of operating income available to service interest payments. C. None D. Compares the market value of a share of stock to the book value per share of the reported equity on the balance sheet. 19. Which of the following statements is an example of a futures market transaction? A. A company purchases an option to buy 1000 barrels of oil anytime between now and the end of the year B. An investor purchases 100 shares of IBM hoping to sell it in two years for a profit C. A company agrees to purchase 1000 barrels of oil for delivery in six months at a price of RM70 per barrel D. An executive has a portion of his current year salary deferred until he retires Your answer is accepted. 20. Time Value of Money is the Principle 2 that form the basics of financial management. This principle says that A. 'A dollar received today worth less than a dollar than a dollar received in the future.' B. 'A dollar received today is worth more than a dollar received in the future.' C. 'A dollar received in the future is worth more than a dollar received today.' D. 'A dollar received today is worth same as a dollar received in the future