1) You are saving for an overseas holiday in two years, which will cost $15,000. How much do you need to deposit in an account paying an interest rate of 6% p.a., compounded monthly, in order to have enough money to pay for the holiday?

2) Principal Computers Ltd is a major retail store operating in Camberwell, Melbourne.The Managing Director of the firm recently purchased two ultramodern computers.One of these computers was designated for resale in order to test the market appetite for the new device, whereas the other was assigned to office use?

3) A boutique vineyard operating in South Australia had a long-term debt of $2,000,000.After discussions with their lender, it was agreed that the lender would receive $2,000,000 of ordinary shares to extinguish the long-term debt.How would this transaction impact on the Statement of Cash Flows?

Select one:

a.No impact on the Statement of Cash Flows

b.Increase cash flow by $2,000,000 for financing activities

c.Increase cash flow by $2,000,000 for investing activities

d.Decrease cash by $2,000,000

e.Increase cash by $2,000,000

4) Which of the following will result in an increase in the value of the equity of a firm?

Select one:

a.Impairment

b.Asset revaluation

c.Receipt of cash from customer who previously purchased goods on credit

d.Depreciation

e.Taxation

5) There are many advantages associated with a shorter inventory turnover period.Which of the following isnotone?

Select one:

a.It reduces the physical space needed to store inventory

b.It reduces the cost of inventory as management can purchase in bulk

c.It reduces the likelihood that inventory will become obsolescent

d.It reduces the amount of funds tied up in inventory, so these can be used elsewhere in the business