1.Analysts refer to the Form W-2 to determine personal cash flows when the client is

A.A self-employed individual.

B.A member-manager of an LLC.

C.A retiree with pension benefits.

D.An employee of a corporation.

2.As part of analyzing a problem loan, a banker will complete all of the following steps EXCEPT:

A.Complete a new lien search.

B.Perform an updated financial analysis.

C.Hire a turnaround consultant.

D.Order an updated appraisal on collateral.

3.Which of the following warning signs of financial difficulty would be less detectable on a companys financial statement?

A.Slow payment of key trade suppliers and delinquent tax payments.

B.Deferral of equipment maintenance and cutback on staff training.

C.Higher line borrowings and sale of production assets.

D.Lower cash balances and reduction of staff through layoffs.

4.What are the most important considerations when determining if a business's cash flow should be included in the global cash flow?

A.Borrower can document ownership and access to the business's cash flow, and the business is sufficiently liquid to support its withdrawal.

B.Borrower is the majority or sole owner of the business and maintains exclusive or majority control over its cash flow.

C.Business has financial statements and tax returns prepared on the same accounting basis as the borrower's and these demonstrate little or no financial co-dependency.

D.Business has the capacity to assume actual contingent liabilities without incurring excess leverage and/or exceeding prudent debt service requirements.

5.When considering Form 1040 Wages, salaries, and tips as a source of cash in the global cash flow formula, one must recognize that the amount reported

A.is net of any pre-tax payroll allocations.

B.includes amounts not corroborated be a W-2.

C.is gross of Medicare deductions.

D.does not include wages from closely held corporations.