An advantage to naive diversification is that it: Eliminates systematic risk. There is no advantage since it is naive. O Increases portfolio returns. Eliminates unsystematic risk. Accruals are: Generally considered to be a free source of financing. Difficult to obtain. O Not normal for most businesses. Negotiated with suppliers. All but which one of the following are associated with trade payable arrangements? O Banker's acceptance. Notes payable Accounts payable. O Wages payable. Vidmar Corp's common stock is selling at $25 per share. The company has 100,000 shares authorized, 80,000 shares issued, 75,000 shares outstanding, and 5,000 treasury shares. What is the company's total market value? $2,000,000 O $1,875,000. O $2,500,000 O $125,000 "Terms of sale" specify: O How much is owed. The price of each item purchased. O When payment is due. The quantity of supplies purchased. Acuna Corporation has prepared the following pro-forma balance sheet for the coming year: Table 5G - Acuna Corporation Pro-Forma Balance Sheet, Coming Year (thousands of $) Current assets Current liabilities Cash $ 600 Accounts payable Accounts receivable 1.300 Notes payable Inventory 1,000 Accrued payables Total current assets 2,900 Total current liabilities Long-term debt Fixed assets (net) 4,100 Common stock Retained earnings $ 800 1,200 400 2,400 2,000 1,000 1.100 6.500 EFN Total Liab. + equity $ 7.000 500 $7.000 Total Assets Reference: Ref 5-3 What will Acuna's quick ratio be assuming it finances its EFN using long-term debt? O 0.79. O 0.66 1.52 O 1.27 We use the "percentage-of-sales method" for financial forecasting because: O It is consistent with modern computer spreadsheet programs. It is the most accurate method. It is both simple and useful. O Almost all accounts behave this way. 10:32 PM gbcnv.instructure.com Question 23 D 2 pts Acuna Corporation has prepared the following pro-forma bala ce sheet for the coming year: Table 5G - Acuna Corporation Pro-Forma Balance Sheet, Coming Year (thousands of 5) Current assets Current liabilities Cash $ 600 Accounts ayable $ 800 Accounts receivable 1,300 Notes payable 1,200 Inventory 1,000 Accrued payables 400 Total current assets 2,900 Total current abilities 2,400 Long-term debt 2,000 Faced assets (net) 4,100 Common stock 1,000 Retained earnings 1.100 6,500 EFN 500 Total Assets $7.000 Total Liab + equity $7.000 Reference: Ref 5-3 What will Acuna's quick ratio be assuming it finances its EFN using current liabilities? O 0.79. 1.27 0.66. 1.52 In the percentage-of-sales method, which of the following is assumed to be a spontaneous account? Common stock. O Accounts receivable. O Mortgage bonds. O Notes payable. In the percentage-of-sales planning process, the "interest expense" account is: O A fixed cost, an account balance that does not change with sales. O A fixed cost, an account balance that changes with sales. O A variable cost, an account balance that does not change with sales. O A variable cost, an account balance that changes with sales. If the exchange rate between the euro and the Japanese yen is 125 yen per euro, and the rate between the British pound and the yen is 160 yen per pound, what is the euro/pound cross rate? 1.2800 euros per pound. 1.2800 pounds per euro. O 0.7813 pounds per euro. O 0.7813 euros per pound The annualized forward when the euro/U.S. dollar exchange rates are EURO.9823 per USD spot and EUR 1.0025 per USD quoted on a three month forward contract is O premium; 4.15%. O premium; 8.23%. discount; 2.63% O discount; 5.49%. An advantage to naive diversification is that it: Eliminates systematic risk. There is no advantage since it is naive. O Increases portfolio returns. Eliminates unsystematic risk. Accruals are: Generally considered to be a free source of financing. Difficult to obtain. O Not normal for most businesses. Negotiated with suppliers. All but which one of the following are associated with trade payable arrangements? O Banker's acceptance. Notes payable Accounts payable. O Wages payable. Vidmar Corp's common stock is selling at $25 per share. The company has 100,000 shares authorized, 80,000 shares issued, 75,000 shares outstanding, and 5,000 treasury shares. What is the company's total market value? $2,000,000 O $1,875,000. O $2,500,000 O $125,000 "Terms of sale" specify: O How much is owed. The price of each item purchased. O When payment is due. The quantity of supplies purchased. Acuna Corporation has prepared the following pro-forma balance sheet for the coming year: Table 5G - Acuna Corporation Pro-Forma Balance Sheet, Coming Year (thousands of $) Current assets Current liabilities Cash $ 600 Accounts payable Accounts receivable 1.300 Notes payable Inventory 1,000 Accrued payables Total current assets 2,900 Total current liabilities Long-term debt Fixed assets (net) 4,100 Common stock Retained earnings $ 800 1,200 400 2,400 2,000 1,000 1.100 6.500 EFN Total Liab. + equity $ 7.000 500 $7.000 Total Assets Reference: Ref 5-3 What will Acuna's quick ratio be assuming it finances its EFN using long-term debt? O 0.79. O 0.66 1.52 O 1.27 We use the "percentage-of-sales method" for financial forecasting because: O It is consistent with modern computer spreadsheet programs. It is the most accurate method. It is both simple and useful. O Almost all accounts behave this way. 10:32 PM gbcnv.instructure.com Question 23 D 2 pts Acuna Corporation has prepared the following pro-forma bala ce sheet for the coming year: Table 5G - Acuna Corporation Pro-Forma Balance Sheet, Coming Year (thousands of 5) Current assets Current liabilities Cash $ 600 Accounts ayable $ 800 Accounts receivable 1,300 Notes payable 1,200 Inventory 1,000 Accrued payables 400 Total current assets 2,900 Total current abilities 2,400 Long-term debt 2,000 Faced assets (net) 4,100 Common stock 1,000 Retained earnings 1.100 6,500 EFN 500 Total Assets $7.000 Total Liab + equity $7.000 Reference: Ref 5-3 What will Acuna's quick ratio be assuming it finances its EFN using current liabilities? O 0.79. 1.27 0.66. 1.52 In the percentage-of-sales method, which of the following is assumed to be a spontaneous account? Common stock. O Accounts receivable. O Mortgage bonds. O Notes payable. In the percentage-of-sales planning process, the "interest expense" account is: O A fixed cost, an account balance that does not change with sales. O A fixed cost, an account balance that changes with sales. O A variable cost, an account balance that does not change with sales. O A variable cost, an account balance that changes with sales. If the exchange rate between the euro and the Japanese yen is 125 yen per euro, and the rate between the British pound and the yen is 160 yen per pound, what is the euro/pound cross rate? 1.2800 euros per pound. 1.2800 pounds per euro. O 0.7813 pounds per euro. O 0.7813 euros per pound The annualized forward when the euro/U.S. dollar exchange rates are EURO.9823 per USD spot and EUR 1.0025 per USD quoted on a three month forward contract is O premium; 4.15%. O premium; 8.23%. discount; 2.63% O discount; 5.49%