1.Noncash operating working capital includes which of the following (mark all that apply, if any).

a) Inventory

b)Accounts receivable

c)Accounts payable

d)Customer deposit liability (deferred revenue)

e)Accumulated depreciation

f)Accrued liabilities (operating)

g)Prepayment assets (prepaid expenses)

2.

Caroline's Hardware, a retail store sold store fixtures during the current period for $60,000. The fixtures had cost $120,000 two years ago. Accumulated depreciation on the fixtures was $50,000 at the time they were sold. The income statement for the period reported a loss on the sale of $10,000. What amount should be reported in the cash flow statement investing activity section for the cash flow from that sale?

	$60,000
	-$10,000
	$40,000
	$0
	$50,000

3.A current ratio greater than 1.0 is generally desirable for a company, according to DMP. Harvey does not think much of fixed numerical benchmarks for financial ratios and suggests comparing a firm's ratio values with industry averages and/or ratio values for industry leaders: True or False

4.When calculating ROA, net income is measured before interest and the income tax impact of that interest because: (Pick all that apply, if any).

Removing the effect of interest without adjusting for the increase in income tax that would result would understate the ratio.

That way, the analyst can observe how well management has utilized the assets to earn a profit before considering the impact on net income of how those assets were financed.

Doing so provides the best measure of return on the owners' investment.

Interest expense is not included in the income statement and, therefore, not deductible in calculating income tax.

5. Publix's 2011 balance sheet shows average shareholders' equity of $4,503 million, net operating profit after tax of $27 million, net income of $50 million, and common shares issued of $758 million. The company has no referred shares issued. Kroger's return on common equity for the year is:

	0.60%
	54.0%
	There is not enough information to calculate the ratio.
	1.11%
	3.56%

6.A current ratio greater than 1.0 is generally desirable for a company. Smith does not think much of fixed numerical benchmarks for financial ratios and suggests comparing a firm's ratio values with industry averages and/or ratio values for industry leaders: True of False