C214 OA Exam 2026 Actual Questions with
Verified Answers | Latest 2026/2027 Update|
100% Correct A+ GRADE
C
Terms in this set (190)
least liquid asset inventory
Inventory consists of 3 parts Raw material, Work in progress, & finished goods
Collection Float Time from account receivable to collect cash
Components of WACC (Weighted Average Market value, tax, equity/common stock, cost of capital, debt,
Cost of Capital) preferred stock, ALL OF THE ABOVE
3 Methods used to Value a Firm/Company Replacement costs (car wrecked - KBB or AutoTrader
Magazine) - compare similar products if need to be replaced
Comparable Multiple (Costco vs Walmart) - P/E Ratio
Discounted Cash Flow (DCF) - Bring future money or cash
flow to today's value (PV)
ALL OF THE ABOVE
Why do companies keep cash for day to day To pay bills
operations
,What are your CURRENT assets? (Own by Inventory, cash, accts receivable, short term investments
company)
Current Liabilities accounts payable & accrued expenses
Operating Leverage (sidebar formula) Carries business risk
BETA (Risk of stock price of specific Sensitive to market changes - NOT A MARKET RISK
company)
NPV vs IRR Net Present Value (NPV) - present value of future inflows
exceeds initial investment - means NPV greater than initial
startup (NPV = 30 - 20 startup) = 10 positive- accept project
Internal Rate of Return (IRR) is discount rate that forces NPV
to equal zero
Both have to be positive numbers to choose the project
Hedging Eliminating risk
Volker Rule (VRL) Limits proprietary/hedge fund trading by banks
FINRA (Financial Industry Regulatory Every player in the market behaves ethically and honestly.
Authority) Check sales practices, bar unethical persons; competency test
EX: Board created after SEC, Traders are not to give insider
information, Every form and agreement are done, Traders are
to get regular training
IFRS (International Financial Reporting US is NOT a part of this yet
Standards) They want everyone to use the format and standards to do
their balance sheets
ROE vs ROA (What is similar - Use sidebar Both use Net Incomes
formulas)
Outsourcing effects Domestic employment decreases (workers in America lose
their jobs)
Profits of the company likely go up, and price of product is
cheaper
Tariffs Additional taxes
Protection for domestic economy
Words used interchangeably PV= price or how much, amount
Sales = Revenue
Equity = Common equity/stock
Preferred Stock = Hybrid (for raising money and can be used
as Debt)
Treasury rate = Risk Free Rate (RF)
Balance Sheet = Snapshot
Par Value = Face Value ($1,000)
EBIT = Operating Income
, Capital Budget Formulas (Sidebar) Initial Cash Outflow = Asses Cost + Shipping & Installation +
Increase in NWC
Differential Cash Flow = NI + Depreciation Expense
Terminal Cash Flow = Salvage Value - Taxes Paid + NWC
Recapture
Treasury Securities Issued by the Federal (US) Government
Dealer Markets Online
No physical location
Auction Markets NYSE - New York Stock exchange
Goal of Private Company Keep control of business
Goal of Public Company Maximize shareholder's value
Annuity Due Pay at the beginning of a period (RENT)
Ordinary Annuities Pay at the end of the period (Credit Cards)
APY vs APR APY = Annual Percentage Yield
APR = Annual Percentage Rate
APR is EQUAL to APY when period is = 1
APY is ALWAYS greater after period 1
Income Statement for Accounting For reporting
Income Statement for Taxes For the IRS
Matching Principle Matching revenues to expenses during a period
Income Statement Over a period of time
Balance Sheet (Snapshot) One point in time
Retained Earnings (Sidebar Formula) Beg RE + NI - Dividends Paid
Time Value of money components N: Time, I/Y: Yield or Interest Rate, PV: Present Value, PMT:
(Calculator Keys) Payment, FV: Future Value
Rule 144-A Safe harbor, protection for US investors raising capital in the
Private Market (NOT regulated by SEC), sell private securities
in US to US investors
Regulation S Safe harbor, protection also for NON-US Investors raising
money in capital market, sell private securities off-shore to
foreigner investors
Verified Answers | Latest 2026/2027 Update|
100% Correct A+ GRADE
C
Terms in this set (190)
least liquid asset inventory
Inventory consists of 3 parts Raw material, Work in progress, & finished goods
Collection Float Time from account receivable to collect cash
Components of WACC (Weighted Average Market value, tax, equity/common stock, cost of capital, debt,
Cost of Capital) preferred stock, ALL OF THE ABOVE
3 Methods used to Value a Firm/Company Replacement costs (car wrecked - KBB or AutoTrader
Magazine) - compare similar products if need to be replaced
Comparable Multiple (Costco vs Walmart) - P/E Ratio
Discounted Cash Flow (DCF) - Bring future money or cash
flow to today's value (PV)
ALL OF THE ABOVE
Why do companies keep cash for day to day To pay bills
operations
,What are your CURRENT assets? (Own by Inventory, cash, accts receivable, short term investments
company)
Current Liabilities accounts payable & accrued expenses
Operating Leverage (sidebar formula) Carries business risk
BETA (Risk of stock price of specific Sensitive to market changes - NOT A MARKET RISK
company)
NPV vs IRR Net Present Value (NPV) - present value of future inflows
exceeds initial investment - means NPV greater than initial
startup (NPV = 30 - 20 startup) = 10 positive- accept project
Internal Rate of Return (IRR) is discount rate that forces NPV
to equal zero
Both have to be positive numbers to choose the project
Hedging Eliminating risk
Volker Rule (VRL) Limits proprietary/hedge fund trading by banks
FINRA (Financial Industry Regulatory Every player in the market behaves ethically and honestly.
Authority) Check sales practices, bar unethical persons; competency test
EX: Board created after SEC, Traders are not to give insider
information, Every form and agreement are done, Traders are
to get regular training
IFRS (International Financial Reporting US is NOT a part of this yet
Standards) They want everyone to use the format and standards to do
their balance sheets
ROE vs ROA (What is similar - Use sidebar Both use Net Incomes
formulas)
Outsourcing effects Domestic employment decreases (workers in America lose
their jobs)
Profits of the company likely go up, and price of product is
cheaper
Tariffs Additional taxes
Protection for domestic economy
Words used interchangeably PV= price or how much, amount
Sales = Revenue
Equity = Common equity/stock
Preferred Stock = Hybrid (for raising money and can be used
as Debt)
Treasury rate = Risk Free Rate (RF)
Balance Sheet = Snapshot
Par Value = Face Value ($1,000)
EBIT = Operating Income
, Capital Budget Formulas (Sidebar) Initial Cash Outflow = Asses Cost + Shipping & Installation +
Increase in NWC
Differential Cash Flow = NI + Depreciation Expense
Terminal Cash Flow = Salvage Value - Taxes Paid + NWC
Recapture
Treasury Securities Issued by the Federal (US) Government
Dealer Markets Online
No physical location
Auction Markets NYSE - New York Stock exchange
Goal of Private Company Keep control of business
Goal of Public Company Maximize shareholder's value
Annuity Due Pay at the beginning of a period (RENT)
Ordinary Annuities Pay at the end of the period (Credit Cards)
APY vs APR APY = Annual Percentage Yield
APR = Annual Percentage Rate
APR is EQUAL to APY when period is = 1
APY is ALWAYS greater after period 1
Income Statement for Accounting For reporting
Income Statement for Taxes For the IRS
Matching Principle Matching revenues to expenses during a period
Income Statement Over a period of time
Balance Sheet (Snapshot) One point in time
Retained Earnings (Sidebar Formula) Beg RE + NI - Dividends Paid
Time Value of money components N: Time, I/Y: Yield or Interest Rate, PV: Present Value, PMT:
(Calculator Keys) Payment, FV: Future Value
Rule 144-A Safe harbor, protection for US investors raising capital in the
Private Market (NOT regulated by SEC), sell private securities
in US to US investors
Regulation S Safe harbor, protection also for NON-US Investors raising
money in capital market, sell private securities off-shore to
foreigner investors
