MGMT 310 Final Exam Questions And Corre
1. cWhich cof cthe cfollowing cwould cimprove cROE?
a. cDecreasing ccost cof cgoods csold cwhile cmaintaining ccurrent clevel cof csales
b. cIncreasing csales cand cincreasing cinterest cexpense cby cthe csame camount
c. cIssuing ccommon cequity cto cthe cmarket
d. cDecreasing cgross cmargin
e. cThere cis cinsufficient cinformation cprovided c- cCORRECT cANS✔✔a. cDecreasing ccost cof cgood
ccurrent clevel cof csales
2. cYou care ccomparing cfinancial cstatements cof ca cfirm cto cthe cpro cforma cstatement cfor cnext cyea
ca c4% cincrease cin csales. cThe cfirm cis ccurrently coperating cat c85% ccapacity. cNWC cand call ccost
ctax crate cand cdividend cpayout cratio care cfixed. cWhat cmust cbe ctrue?
a. cProjected cdividends cequal cthe ccurrent ccash cdividend camount
b. cDepreciation cwill cdecrease cby c4%
c. cRE cwill cincrease cby c85% cof cthe cprojected cincome
d. cTotal cassets cwill cincrease cby cless cthan c4%
e. cTotal cliabilities cand cequity cwill cincrease cby c4% c- cCORRECT cANS✔✔d. cTotal cassets cwill cin
3. cExternal cFinancing cneed cis cfinanced cby cwhich cof cthe cfollowing?
a. cEquity, cRE, cDebt, cCash cReserves c- cCORRECT cANS✔✔Equity c& cDebt
4. cDouble ctaxation crefers cto:
a. cA cfirm cpays ctaxes con cearnings cand cdividends cpaid
b. cA cfirm cpays ctaxes con cearnings cand cwhen cthose cearnings care crepatriated cto cthe chome ccou
c. cA cfirm cpays ctaxes con cearnings cand cthe cinvestor cpays ctaxes con cdividends creceived cfrom cth
d. cA cfirm cpays cboth csales ctax cand cincome ctax
e. cNone cof cthe cabove c- cCORRECT cANS✔✔c. cA cfirm cpays ctaxes con cearnings cand cthe cinvest
creceived cfrom cthe cfirm
5. cWhich cof cthe cfollowing caccounts care cincluded cin cworking ccapital cmanagement?
a. cAccounts cpayable, caccounts creceivable, cfixed cassets, cinventory c- cCORRECT cANS✔✔Every
6. cZhao chas csales cof c$6000, ctotal cassets cof c$4200, cand ca cdebt-equity cratio cof c0.4. cWhat cis c
, 9. cWhich cof cthe cfollowing cindividuals chave cunlimited cliability cbased con cownership cinterest?
a. cGeneral cpartner, csole cproprietor, cstockholder, climited cpartner c- cCORRECT cANS✔✔General
10. cDietz cpaid c$1300 cin cdividends cand c$920 cin cinterest cthis cpast cyear. cCommon cstock cincrea
cincreased cby c$310. cWhat cis cthe cNI?
a. c-$210
b. c$990
c. c$1610
d. c$1910
e. c$2190 c- cCORRECT cANS✔✔$1610
11. cHunter cpaid c$100 cin cdividends cand c$511 cin cinterest cexpense. cThe caddition cto cRE cis c$41
c$500. cThe ctax crate cis c35%. cSales care c$15,900 cand cdepreciation cis c$680. cWhat cis cEBIT?
a. c$589.46
b. c$1294.46
c. c$1307.92
d. c$9560.85
e. c$15,220.00 c- cCORRECT cANS✔✔$1307.92
12. cWhich cof cthe cfollowing cbest cdescribes cthe cprimary cgoal cof cfinancial cmanagement?
a. cMaximize ccurrent cvalue cper cshare
b. cMaximize ccurrent cdividend cper cshare
c. cIncrease ccash cflow cand cavoid cfinancial cdistress
d. cMinimize coperational ccosts cwhile cmaximizing cfirm cefficiency
e. cMaintain csteady cgrowth cwhile cincreasing ccurrent cprofits c- cCORRECT cANS✔✔a. cMaximize cc
13. cWhich cof cthe cfollowing cactions cby ca cfinancial cmanager cis cmost capt cto ccreate can cagency c
a. cRefusing cto cborrow cmoney cwhen cdoing cso cwill ccreate closs cfor cthe cfirm
b. cRefusing cto clower cselling cprices cif cdoing cso cwill creduce cthe cnet cprofits
c. cRefusing cto cexpand cthe ccompany cif cdoing cso cwill clower cvalue cof cequity
d. cAgreeing cto cpay cbonuses cbased con cthe cmarket cvalue cof cthe ccompany ctock crather cthan con
e. cIncreasing ccurrent cprofits cwhen cdoing cso clowers cthe cvalue cof cequity c- cCORRECT cANS✔✔
cdoing cso clowers cthe cvalue cof cequity
OCF ccalculation c- cCORRECT cANS✔✔ebit c+ cdep c- ctaxes
NCS ccalculation c- cCORRECT cANS✔✔2016 cNFA c- c2015 cNFA c+ cDep`
Cash cflow cto clenders/creditors? c- cCORRECT cANS✔✔Interest c- c(2016 cLTD c- c2015) c= c$600
Cash cflow cto cshareholders c- cCORRECT cANS✔✔Dividends cpaid c- c(2016 cCS c- c2015 cCS)
= c$100
23. cIf csales care cprojected cto cincrease cby c20% cin c2016, cwhat cis cEFN?
a. cNone c
b. c$636
c. c$960
d. c$1080
e. c$1280 c- cCORRECT cANS✔✔Don't cchange cLTD cor cCS. cTo csolve cfor cRE= cBB cRE
+New cNI
- cNew cDiv
= cEB cRE
$1080!!!! cGuessed cand cgot clucky.
1. cWhich cof cthe cfollowing cwould cimprove cROE?
a. cDecreasing ccost cof cgoods csold cwhile cmaintaining ccurrent clevel cof csales
b. cIncreasing csales cand cincreasing cinterest cexpense cby cthe csame camount
c. cIssuing ccommon cequity cto cthe cmarket
d. cDecreasing cgross cmargin
e. cThere cis cinsufficient cinformation cprovided c- cCORRECT cANS✔✔a. cDecreasing ccost cof cgood
ccurrent clevel cof csales
2. cYou care ccomparing cfinancial cstatements cof ca cfirm cto cthe cpro cforma cstatement cfor cnext cyea
ca c4% cincrease cin csales. cThe cfirm cis ccurrently coperating cat c85% ccapacity. cNWC cand call ccost
ctax crate cand cdividend cpayout cratio care cfixed. cWhat cmust cbe ctrue?
a. cProjected cdividends cequal cthe ccurrent ccash cdividend camount
b. cDepreciation cwill cdecrease cby c4%
c. cRE cwill cincrease cby c85% cof cthe cprojected cincome
d. cTotal cassets cwill cincrease cby cless cthan c4%
e. cTotal cliabilities cand cequity cwill cincrease cby c4% c- cCORRECT cANS✔✔d. cTotal cassets cwill cin
3. cExternal cFinancing cneed cis cfinanced cby cwhich cof cthe cfollowing?
a. cEquity, cRE, cDebt, cCash cReserves c- cCORRECT cANS✔✔Equity c& cDebt
4. cDouble ctaxation crefers cto:
a. cA cfirm cpays ctaxes con cearnings cand cdividends cpaid
b. cA cfirm cpays ctaxes con cearnings cand cwhen cthose cearnings care crepatriated cto cthe chome ccou
c. cA cfirm cpays ctaxes con cearnings cand cthe cinvestor cpays ctaxes con cdividends creceived cfrom cth
d. cA cfirm cpays cboth csales ctax cand cincome ctax
e. cNone cof cthe cabove c- cCORRECT cANS✔✔c. cA cfirm cpays ctaxes con cearnings cand cthe cinvest
creceived cfrom cthe cfirm
5. cWhich cof cthe cfollowing caccounts care cincluded cin cworking ccapital cmanagement?
a. cAccounts cpayable, caccounts creceivable, cfixed cassets, cinventory c- cCORRECT cANS✔✔Every
6. cZhao chas csales cof c$6000, ctotal cassets cof c$4200, cand ca cdebt-equity cratio cof c0.4. cWhat cis c
, 9. cWhich cof cthe cfollowing cindividuals chave cunlimited cliability cbased con cownership cinterest?
a. cGeneral cpartner, csole cproprietor, cstockholder, climited cpartner c- cCORRECT cANS✔✔General
10. cDietz cpaid c$1300 cin cdividends cand c$920 cin cinterest cthis cpast cyear. cCommon cstock cincrea
cincreased cby c$310. cWhat cis cthe cNI?
a. c-$210
b. c$990
c. c$1610
d. c$1910
e. c$2190 c- cCORRECT cANS✔✔$1610
11. cHunter cpaid c$100 cin cdividends cand c$511 cin cinterest cexpense. cThe caddition cto cRE cis c$41
c$500. cThe ctax crate cis c35%. cSales care c$15,900 cand cdepreciation cis c$680. cWhat cis cEBIT?
a. c$589.46
b. c$1294.46
c. c$1307.92
d. c$9560.85
e. c$15,220.00 c- cCORRECT cANS✔✔$1307.92
12. cWhich cof cthe cfollowing cbest cdescribes cthe cprimary cgoal cof cfinancial cmanagement?
a. cMaximize ccurrent cvalue cper cshare
b. cMaximize ccurrent cdividend cper cshare
c. cIncrease ccash cflow cand cavoid cfinancial cdistress
d. cMinimize coperational ccosts cwhile cmaximizing cfirm cefficiency
e. cMaintain csteady cgrowth cwhile cincreasing ccurrent cprofits c- cCORRECT cANS✔✔a. cMaximize cc
13. cWhich cof cthe cfollowing cactions cby ca cfinancial cmanager cis cmost capt cto ccreate can cagency c
a. cRefusing cto cborrow cmoney cwhen cdoing cso cwill ccreate closs cfor cthe cfirm
b. cRefusing cto clower cselling cprices cif cdoing cso cwill creduce cthe cnet cprofits
c. cRefusing cto cexpand cthe ccompany cif cdoing cso cwill clower cvalue cof cequity
d. cAgreeing cto cpay cbonuses cbased con cthe cmarket cvalue cof cthe ccompany ctock crather cthan con
e. cIncreasing ccurrent cprofits cwhen cdoing cso clowers cthe cvalue cof cequity c- cCORRECT cANS✔✔
cdoing cso clowers cthe cvalue cof cequity
OCF ccalculation c- cCORRECT cANS✔✔ebit c+ cdep c- ctaxes
NCS ccalculation c- cCORRECT cANS✔✔2016 cNFA c- c2015 cNFA c+ cDep`
Cash cflow cto clenders/creditors? c- cCORRECT cANS✔✔Interest c- c(2016 cLTD c- c2015) c= c$600
Cash cflow cto cshareholders c- cCORRECT cANS✔✔Dividends cpaid c- c(2016 cCS c- c2015 cCS)
= c$100
23. cIf csales care cprojected cto cincrease cby c20% cin c2016, cwhat cis cEFN?
a. cNone c
b. c$636
c. c$960
d. c$1080
e. c$1280 c- cCORRECT cANS✔✔Don't cchange cLTD cor cCS. cTo csolve cfor cRE= cBB cRE
+New cNI
- cNew cDiv
= cEB cRE
$1080!!!! cGuessed cand cgot clucky.
