ABC Ltd. reported $320 million and $500 million in common equity at the beginning and at the end of the financial year, respectively. During the year, ABC had paid common share dividend of $25 million and had repurchased $15 million common shares. Calculate comprehensive income of the ABC for the year? Select one: a. $40 million b. $140 million c. $180 million d. $220 million

A firm has 10 million ordinary shares trading at $19.00, net debt of $50 million and an enterprise price-to-book ratio of 2.0. The book value of the equity is: Select one: a. $70 million b. $95 million c. $120 million d. $140 million

Which of the following statements regarding the comparison between the residual earnings (RE) model and abnormal earnings growth (AEG) model is false? Select one: a. The RE model and AEG model will usually result in similar valuations b. Both models can protect investors against earnings created by accounting c. Abnormal earnings growth is equal to the change in residual earnings d. Both models require an appreciation of the concept of cum-dividend earnings

On any given day, it is possible to observe a wide variation in price-to-earnings (P/E) ratios.

Which of the following statements is a best explanation for a high P/E ratio relative to other firms? Select one: a. The firm may have substantial assets not recorded on the balance sheet b. The P/E ratio of firm was calculated using cum-dividend rather than ex-dividend earnings c. Future earnings for the firm are forecast to be considerably higher than current earnings d. The firm is currently recording gains which are considered to be temporary

Suppose a firm has a required return of 12% and its return on common equity (ROCE) last year was 10%. If the shares of the firm trade at a price-book-ratio of 1.2, which of the following conclusions is valid? Select one: a. The shares of the firm are mispriced b. The market is expecting the future ROCE to be below 12% c. The market is expecting the future ROCE to be above 12% d. None of the above

A firm has total assets of $24 million, debt totalling $12 million and an enterprise value of $30 million. If the firm has 3 million shares outstanding, what is the market value per share? Select one: a. $4.00 b. $6.00 c. $8.00 d. $10.00

A firm is expected to have an ROCE of 6% per year indefinitely. Its current BPS is $9.27 and it has a required return of 8.2%. The firm has a full dividend payout policy. What is the intrinsic P/B ratio (approx.)? Select one: a. 1.90 b. 0.64 c. 1.27 d. 0.12

ABC Ltd. reported $140 million increase in cash over a year. It also reported $330 million in cash flow from operations, and a net $130 million received in financing activities. How much did the firm invest in operations? Select one: a. $60 million b. $320 million c. $340 million d. $600 million