e. $48,000 21. ABC Corp. reports pre tax income of $100,000 which includes a one time $60,000 restructuring charge. The effective tax rate is 30%. How much is core net income. a. $160,000 b. $118,000 C. $112,000 d. $82,000 e $28,000 22. Which of the following is not true with respect to value stocks a. They pay dividends b. They do share repurchases C. They have positive operating cash flow d. Their net income increases very rapidly e. They are established companies with proven track records 23. In terms of net income estimates, rank them in order of highest (most optimistic) to lowest a. Analyst consensus, company guidance, whisper number b. Company guidance, analyst consensus, whisper number C. Whisper number, company guidance, analyst consensus d. Analyst consensus, whisper number, company guidance e. Whisper number, analyst consensus, company guidance 24. Which of the following is not a goal of fundamental financial statement analysis a. Determine valuation of company b. Determine borrowing capacity of a company C. Determine price of common shares to be sold in public offering d. Determine whether stock price will go up or down in next week e. Evaluate liquidity and solvency of company 25. What is meant by the term "big bath" a. All executive officers of company clean themselves with soap in a large tub b. In what would otherwise be a great quarter, company takes a large restructuring reserve C. In what would otherwise be a great quarter, company buys new headquarters builiding d. In what would otherwise be a poor quarter, company takes a large restructuring reserve e. In what would otherwise be a poor quarter, company buys a new headquarters building 26. What best describes the accounting policy of a 52/53 week fiscal year a. Fiscal year ends on the Sunday closest to December 31 b. Fiscal year ends on December 31 each year c. Over a 10 year period, every year has the same number of weeks d. Over a 10 year period, every fiscal year has 365 days e. Over a 10 year period, every fiscal year has 364 days 29. Kissena Corp. reports 2019 Income Before Taxes of $700,000. Included in the $700,000 are a one time loss on sale of building of $200,000 and a one time gain from settlement of lawsuit of $250,000. How much is core pre-tax operating income. a. $250,000 b. $650,000 c. $700,000 d. $750,000 e. $1,150,000 30. In 2018 Penn National Corp reports Sales of $8 million and Cost of Goods Sold of $3 million. In 2019 Penn National Corp reports Sales of $9 million and Cost of Goods Sold of $5 million. What is the percentage change in gross profit between 2018 and 2019. a. increase of 25% b. decrease of 25% c. increase of 20% d. decrease of 20% e decrease of 80% 31. Bentz Corp. has a leverage (debt/equity) ratio of 4.0 that it wishes to reduce. Which of the following actions will achieve this goal a. purchase Treasury shares b. increase dividends to common shareholders C. borrow additional money due in 10 years d. issue new common shares e collect accounts receivable before due date farinactmenthanks nrenare renarts 32. Financial analysts who work for investment banks prepare reports for customers of that investment bank recommending whether a stock is a "buy", "sell or hold. These analysts are referred to as: a. Buy side analysts b. Sell side analysts c. Growth analysts d. Value analysts e. Technical analysts 33. Which of the following is not considered a market risk_ a. Ability of customer to repay b. Increasing interest rates C. Rise in commodity prices d. Weakening of foreign currency e. Changing prices of fixed income securities
