QUESTION 1

1. Anne Dever has invested $45,000 in an interst-bearing savings account which will earn 5% compounded interest.She plans to leave the initial investment in the account for five years.

How much will Anne have in the account at the end of the five years?

A.

$37,960

B.

$225,000

C.

$57,433

D.

$45,000

QUESTION 2

1. Calculate the required return for Asset Z, which has a beta of 1.2.The risk-free rate is 5% and the market return is 7%.

A.

12.0%

B.

6.2%

C.

5.2%

D.

7.4%

QUESTION 3

1. The Retained Earnings account is found on the:

A.

Statement of Cash Flows

B.

In the Stockholders' Equity section of the Balance Sheet

C.

Income Statement under operating expenses

D.

In the liabilities section of the Balance Sheet

QUESTION 4

1. When using financial ratios to evaluate a company's financial position, the Current Ratio is designed to evaluate the company's:

A.

Liquidity

B.

Capital strength

C.

Earnings strenth

D.

Profitablity

QUESTION 5

1. When preparing the Statement of Cash Flows, the payment of cash dividends is considered:

A.

Cash flow from Financing Activities

B.

Cash flow from Operating Activities

C.

A reduction in the Cash balance

D.

Cash Flow from Investing Activities

QUESTION 6

1. In the Statement of Retained Earnings, the Beginning Retained Earnings balance is reduced by:

A.

Net income earned during the current period

B.

The payment of dividends during the current period

C.

Operating expenses during the current period

D.

Taxes paid during the current period

QUESTION 7

1. On January 1, 2019 the common stock for Collins Corporation had a market value of $28.00.At December 31, 2019, the market value had increased to $30.00.During the year, Collins Company paid a cash dividend of $2.00.

What was the annual return to an investor during 2019?(Round to the nearest decimal point.)

A.

10.5%

B.

14.3%

C.

15.2%

D.

12.0%

QUESTION 8

1. Below is selected information for the Goldman Company;

Retainedearnings12/31/20182,800

Retained earnings12/31/20194,000

Net income - 20182,200

Calculate the amount of cash dividends paid by the Goldman Company during 2018.

A.

$1,000

B.

$1,200

C.

$500

D.

$700

QUESTION 9

1. Ratios that are designed to evaluate a company's efficiency in managing its Accounts Receivable and Inventory accounts are designated as:

A.

Debt ratios

B.

Liquidity ratios

C.

Activity ratios

D.

Market ratios

QUESTION 10

1. In 2019. Company XYX reported $100,000 in Net Income and paid $20,000 in Preferred Stock dividends.The Company has 1 million(1,000,000) common shares outstanding.

What was XYZ's Earnings per share in 2019?

A.

$1.00

B.

$0.10

C.

$1.20

D.

$0.08

QUESTION 11

1. The common stock for Company A has a beta of 1.2,Investors should interpret this beta to mean that Company A is:

A.

Cannot be determined

B.

The same risk as the market in general

C.

More risky than the market in general

D.

Less risky than the market in general

QUESTION 12

1. Louise invests in an annuity where she deposits $1,800 a year into an account for 5 years which will earn 5% interest.How much will Louis have in her account at the end of the five years?

A.

$9,946

B.

$4,575

C.

$8,250

D.

$7,500

QUESTION 13

1. The Miller Company's common stock is trading for $24.They reported Earnings Per Share of $2.00.What is Miller Company's Price Earnings (PE) multiple?

A.

6x

B.

8x

C.

12x

D.

10x

QUESTION 14

1. Anderson Company has bought a significant new computer system during the year.This purchase will be reported on the Statement of Cash Flows as:

A.

Cash Flow from Investing Activities

B.

This activity is not reported on the Statement of Cash Flows

C.

Cash Flow from Financing Activies

D.

Cash Flow from Operating Activities

QUESTION 15

1. The components of the Gross Profit Margin ratio are:

A.

Accounts Receivable / Sales

B.

Sales less Cost of Goods Sold / Sales

C.

Net Income After Taxes (NIAT) / Sales

D.

Sales / Inventory