Total leverage is a measure of total risk: it measures how earnings per share will change with a change in sales. * 1 point True False [Checkbox: 1, 2, 3, or 4 options may be needed to form the correct answer]. Which of the following is a formula for a financial ratio? * 1 point earnings before interest and taxes / interest expense average age of inventory / accounts payable period (total shareholder equity - preferred stock) / shares outstanding (cash + marketable securities + A/R) / current liabilities Business risk depends on the variability in: * 1 point A company has total earnings after tax this quarter of $300,000. 40% will be retained earnings, adding to capital, and 60% paid out as a dividend to shareholders. There are 100,000 dividend-receiving shares. The Board will declare a dividend of: * 1 point $1,80 $1,59 $3,99 $0.45 Risk can be captured in either ___ or ____ terms. * 1 point systemic, diversifiable formal, informal revenue, expense absolute, relative [Checkbox: 1, 2, 3, or 4 options may be needed to form the correct answer]. Which of these balance sheet entries reflect the company's capital structure? * 1 point Goodwill Retained Earnings Bonds Shareholders' Equity [One word answer]. Both the NPV and IRR are _____ cash flow methods. * 1 point Cash budgets should contain non-cash charges such as amortisation expense (depreciation) * 1 point Trye Fakse [One word answer] You would use a ____ value calculation to determine how much an investemt is earning for you. * 1 point Investors buy preferred shares as oppoised to common shares because they expect to profit from a price rise in the value of the shares. * 1 point True False [Checkbox: 1, 2, 3, or 4 options may be needed to form the correct answer]. To minimise work, no tax adjustment is necessary when calculating and comparing the cost of capital for: * 1 point common stock retained earnings bonds preferred stock Given a discount rate of 10%, which option gives you the greater return? * 1 point Every day in April the company purchases $750 of supplies on terms net/30 days. The Accounts Payables, by April 30, should have increased to: * 1 point $15,750 $21,750 $23,250 $22,500 The interest rate on a longer term loan is usually higher than the rate on a short term loan. * 1 point True False [Checkbox: 1, 2, 3, or 4 options may be needed to form the correct answer]. You operate in multiple countries with their own currencies. You can minimise your currency risk by: * 1 point Do a carry trade (borrow in one currency and invest in another) Buying futures (forward) contracts locking in the exchange rate Switch your operations to only use one currency Exchanging funds when rates move in your favour Which of these choices will use more working capital? * 1 point Break-even analysis uses ___, ___, and _____ to determine how many sales are required to not lose money. * 1 point Which of these takes into account the time value of money? * 1 point Internal Rate of Return Payback period Average rate of return Short term liabilities Finance departments have two major sections, which are: * 1 point Capital management and budgets Cash management and bookkeeping Investments and operations Controller and Treasurer Which one is calculated on a pie-tax basis? * 1 point Cost of debt capital Cost of preferred share issuance Cost of capital for retained earnings Cost of common shares issuance