13,14,15 multiple choice

Danielle's Sushi Shop last year had (1) a negative net cash flow from operations, (2) a negative free 13. cash flow, and (3) an increase in cash as reported on its balance sheet. Which of the following facts could explain this situation? The company had a sharp increase in its depreciation and amortization expenses The company had a sharp increase in its inventories. The company had a sharp increase in its accrued liabilities The company sold a new issue of common stock The company made a large capital investment early in the year a. b. . d. e. 14. You plan to analyze the value of a potential investment by calculating the sum of the present values of its expected cash flows. Which of the following would lower the calculated value of the investment? The discount rate decreases. a. b. The cash flows are in the form of a deferred annuity, and they total to $100,000. You learn that the annuity lasts for only 5 rather than 10 years, hence that each payment is for $20,000 rather than for $10,000 The discount rate increases The riskiness of the investment's cash flows decreases. . d. The total amount of cash flows remains the same, but more of the cash flows are received in the e. earlier years and less are received in the later years. You plan to analyze the value of a potential investment by calculating the sum of the present values 15. of its expected cash flows. Which of the following would increase the calculated value of the investment? The discount rate increases The cash flows are in the form of a deferred annuity, and they total to $100,000. You learn that the annuity lasts for 10 years rather than 5 years, hence that each payment is for S10,000 rather than for $20,000. a. b. The discount rate decreases. . d. The riskiness of the investment's cash flows increases. The total amount of cash flows remains the same, but more of the cash flows are received in the . later years and less are received in the earlier years