IBM 2010-005: ACCOUNTING AND FINANCIAL CONCEPT DATE: APRIL 26, 2022 TUESDAY (7PM-8.45PM) TEST 3 V2: 175 POINTS (35 QUES, WEIGHT 25%) TIME: 1 HOUR 45 MINUTES NAME: STUDENT ID : C.CODE: Instruction: Keep your eyes on your own paper. If you caught cheating, you will get a zero for the exam! Only pen/pencil and traditional calculator is allowed Stop writing immediately when the time is up, any late submission will deduct marks. . Place your Student ID card on your desk All your belongings will be up front including cell phones, bags, cases, hats etc. . Show all math calculations in the 'rough calculation area. GOOD LUCK STUDENTS ! Questions 1-2 are based on the numbers below; M = 0.052 R = 0.62 D/E = 1.01 A = 0.95 1. What is the Business's Sustainable Growth Rate? a. 9.43% b. 8.20% C. 7.32% d. 2.37% 2. If Sales Revenue for the previous year was $1,450,000, what would be the optimal S Revenue for the following year? (Based on the Growth Rate) a. 1,586,735 b. 1,484,365 c. 1,568,900 d. 1,556,140 Questions 3-4 are based on the numbers below; Z-Score = 1.2 (a) + 1.4 (b) + 3.3 (c) + 0.6 (d) + 1.0 (e) Revenue $ 630,000 Total Assets Total Liabilities Retained Earnings $ 150,000 Earnings before Interest and Taxes (EBIT) $ 60,000 Equity Current Liabilities Current Assets $ 250,000 3. What is the business's Z-Score? 828. b. 3.87 c. 3.73 d. 1.76 a. 4.2020. Which credit principle refers to industry's trends and government regulations a) Character b) Circumstances c) Coverage d) Capacity 21. Risk capital can be provided by government backed corporations. a) True b) False 22. Who identifies "financial needs" before approaching to investors a) Controller b) CFO c) Financial Analysts d) Treasurer 23. Financial Projections are performed before operating budgets a) True b) False 24. Which method gives rough estimate of ROI a) Payback Method - Traditional b) Payback Reciprocal c) Payback Method - Discounted d) None of the Above 25. What "PI" means? a) Profitability Index b) Benefit-Cost Ratio c) Profit Value Index d) All of the Above 26. Internal Rate of Return (IRR) shows the economic merits of several projects and compare returns with other financial indicators a) True b) False 27. Which method fails to measure the true economic worth of a capital expenditure pr a) IRR b) NPV c) Payback Method d) PI28. Huddle Rate is influenced by: a) Nature of Projects coldeT outsV Ineast b) Reputation of Company c) Capital Structure .Five rabohsd n of Massyes it d) All of the above e) Both a & c COTELD 29. is based on a business's Capital Structure? a. Financial Risk b. Business Risk c. Instrument Risk d. Capital Risk 30. Expense investments have significant financial impact than capital investments. a) True b) False 31. By doing the right things means - being effective a) True b) False 32. Pursing the right goals but wasting resources means : a) High Efficiency, Low Effectiveness b) Low Effectiveness, Low Efficiency c) High Effectiveness, Low Efficiency d) High Efficiency, High Effectiveness 33. "Program Budget" is a part of : a) Comprehensive Budget b) Operating Budget c) Complementary Budget d) Capital Budget 34. Business Plan helps to assess management's ability to plan and organize. a) True b) False 35. The Control Process : a) Designing Subsystem -> Performance Standards -> Measure & Analyze -> Corrective A b) Performance Standards -> Design Subsystem -> Measure & Analyze -> Corrective Acti c) Designing Subsystem -> Measure & Analyze -> Corrective Action -> Performance Stan d) None of the Above