True or False. When creating a Statement of Cash Flows, the Change in Accounts Receivable is calculated as Accounts Receivable in 2015 minus Accounts Receivable in 2016.

True

False

True or False. The three different types of measure leverage are: Financial, Operating and Contribution.

True

False

Which statement is true relating to Common-Size financial statements?

		Common-Size shows items in the Income Statement as a percentage relative to Sales.
		Common-Size shows items in the Balance Sheet as a percentage relative to Sales.
		Common-Size shows items in the Statement of Cash Flows as a percentage relative to the beginning cash balance.
		All of the above
		a and b
		a and c

What does compound rate of return (CAGR) mean?

		It is the straight average rate of return
		It is the rate of return required assuming profits were reinvested each year
		It is the geometric mean
		b and c

Assume that the Earning Before Interest and Taxes is $30,000, the Earnings before Taxes is $25,000 and the Tax Rate is 40%. What is the Net Income?

		$13,000
		$18,000
		$15,000
		$25,000

What should be the formula in B6? 1 Sales 2 Variable Costs 3 Fixed Costs 4 EBIT 5 Degree of Financial Leverage 6 Degree of Combined Leverage B 5,000,000 2,000,000 1,500,000 1,500,000 1.28 ? =B5*(B1-B2)/B3 =B5*(B2-B3/B4 =B5*B1-B2/B4 =B5*(B1-B2)/B4 jo =B5*(B1-B3)/B4 What should be the formula in B6? 1 Sales 2 Variable Costs 3 Fixed Costs 4 EBIT 5 Degree of Financial Leverage 6 Degree of Combined Leverage B 5,000,000 2,000,000 1,500,000 1,500,000 1.28 ? =B5*(B1-B2)/B3 =B5*(B2-B3/B4 =B5*B1-B2/B4 =B5*(B1-B2)/B4 jo =B5*(B1-B3)/B4