Fin 461 final exam questions with answers,

Fin 461 final exam questions with answers
// // // // // //




Innovative /
/Inventions, //Inc. //needs //to //raise //€10 //million. //If //the //company //chooses //to //issue //zero-


coupon //bonds, //its //debt-to-
equity /
/ratio //will //most //likely //- //CORRECT //ANSWERS(S)✔✔rise //as //the //maturity //date //approaches.




Oil /
/Exploration /


/LLC /


/paid /


/$45,000 /


/in /


/printing, //legal //fees, //commissions, //and //other //costs //associated //with //its //recent //bond //issue.


//It /


/is /


/most /


/likely //to //record //these //costs //on //its //financial //statements //as //- //CORRECT //ANSWERS(S)✔✔an


//asset //under //USGAAP //and //reduction //of //the //carrying //value //of //the //debt //under //IFRS.




The //information //provided //by //a //low-
quality /
/financial /


/report /


/will //most //likely: //- //CORRECT //ANSWERS(S)✔✔impede //the //assessment //of //earnings //quality.




Low /
/quality //earnings //most //likely //reflect: //- //CORRECT //ANSWERS(S)✔✔company //activities //which


//are //unsustainable.

, An /
/audit /


/opinion /


/of //


a/
/company's /


/financial /


/reports /


/is /


/most /


/likely /


/intended /


/to: //- //CORRECT //ANSWERS(S)✔✔assure //that //financial //information //is //presented //fairly.




Which /
/of /


/the /


/following /


/is /


/an /


/indication /


/that //


a/
/company /


/may /


/be /


/recognizing /


/revenue /


/pre- /


/maturely? /


/Relative /


/to /


/its /


/competitors, /


/the //company's: //- //CORRECT //ANSWERS(S)✔✔days //sales //outstanding //is //increasing.