Farms has common stock of $101, paid-in-capital of $358, total liabilities of $455, current assets of $480 and net fixed assets of $690. What is the amount of shareholders' equity?

	$575
	$1170
	$715
	$914

Farms has a subsidiary business that it wishes to sell. You have been asked to compute the market value of the subsidiary. The following facts exist:

1. A building with a cost of $1.210,000 was appraised at $1,410,000.

2. Equipment with a cost of $690,000 was appraised at $437,000

3. Inventory on the balance sheet has a value of $380,000, but has a market value of only one-half that amount.

4. There are $210,200 in accounts receivable. of which 98% is expected to be collected.

5. Cash on hand is $10,200

6. Total liabilities are $1,410,000

What is the market value of the subsidiary?

	$1,243,396
	$843,196
	$1,623,396
	$627,000

Farms has credit sales of $859,700; Cash sales of $140,300; Cost of Good sold of $648,200; Net income of $125,000; and accounts receivable of $102,300. How many days of sales are in receivables?

	43.43
	37.34
	54.53
	29.41

Farms has cash of $6,800; accounts receivable of $14.200; accounts payable of $23,500 and inventory of $31,800. What is the quick (or Acid test) ratio (rounded to two decimals)?

	.89
	.71
	1.35
	2.25

Your grandfather, a baron left several thousand dollars in peanut butter jars, which you found behind the kitchen wall while restoring the house he left you in his will. While contemplating what to do with the money, you decided to make a peanut butter and jelly sandwich from an old jar of peanut butter you found. After eating the sandwich, you immediately developed symptoms of botulism that left you with a permanent facial twitch and a savant-like understanding of math. In the hospital recovery room you set a goal of having $1,250,000 in 45 years. You estimated you could make an average of 7.6% on your investment. How much would you need to invest today to have $1,250,000 in 45 years?

	$46.276.21
	5 bucks
	$66,745.06
	$21,319.47

On your tenth birthday, you received $300 from your crazy uncle Scaramouch, a former circus clown. Your parents promptly took the $300 and invested it for you at 4.5% interest. 21 years later they finally decided today you were mature enough to manage the money and gave you the total proceeds. What were the proceeds?

	$756.07
	$3866.12
	A million gazillion dollars.
	$1174.16

If a project has a net present value of zero, the project could be described as having cash inflows equal to its cash outflows in current dollar terms.

	True
	False

A firm has a choice between two projects. Since both projects require the same piece of equipment, only one of them may be accepted. The projects therefore are:

	mutually inclusive
	Interdependent
	Mutually exclusive
	Independent

A project has an initial cost of $7,900. Cash inflows are estimated to be $2,100. $3,140, $3,800 and $4,500 over the next 4 years, respectively. What is the payback period?

	2.7 years
	100 years
	3.36 years
	3.28 years

Farms is studying the potential of a new project. Here is the salient information:

1. Initial cost of the project is $38,000

2. Cash inflows for three years: Year 1. $12,300; year 2 $24,200; Year 3. $16,100

3. The required rate of return is 16.8%

Based upon Internal Rate of Return (IRR), should this project be accepted? Why or why not?

	No, the IRR is less than the required rate of return
	No, the IRR is equal to the required rate of return
	Yes, the IRR is equal to the required rate of return
	Yes, the IRR exceeds the required rate of return

In actual practice, financial managers use which two types of investment criteria

	Internal Rate of Return and Payback
	Payback and Discounted Payback
	Internal Rate of Return and Net Present Value
	Accounting Rate of Return and Profitability Index

Which of the following will increase the net present value of a project?

	Increasing the value of each of the project's discounted cash inflows
	Decreasing the project's initial costa time zero
	Decreasing the required discount rate
	All of the above

Farms is looking at a project with a piece of equipment that requires an initial cash outlay of $200,000. The equipment is expected to have a after-tax salvage value at the end of the project of $50,000. How will this salvage value be handled when computing the Net Present Value of the project?

	As a cash inflow in the final year of the project
	Reduction of the cash outflow at year 0
	Excluded from the NPV computation
	As a cash inflow prorated over the life of the project

Farms has a project it is considering. The project will produce cash inflows of $2,900 per year for 3 years. The required rate of return is 15.4% and has a initial cost of $6,800. What is the discounted payback period?

	1.28 years
	.91 years
	1.39 years
	Never

ABAC Farms is considering a project with piece of equipment that has an initial cost of $31,300. the project has a 3-year life. The equipment is single use meaning that at the end of the 3 years, it will be fully depreciated on a straight line basis and will have no salvage value. Projected net income for the three years is $1,750, $2,100. and $1,700, respectively. What is the average accounting return

	11.69%
	10.35%
	11.82%
	12.79%