FIN 3154 CORPORATE FINANCE EXAM-1 QUESTIONS AND ANSWERS 2026.pdf

FIN 3154 CORPORATE FINANCE
EXAM-1 QUESTIONS AND ANSWERS
2026

The income statement measures performance ___________ - CORRECT ANSWER

(S) -over a specific period of time




The accounting definition of income is (formula) - CORRECT ANSWER (S) -Revenue

- Expenss = Income




Everything on the income statement is what kind of variable? - CORRECT ANSWER

(S) -Flow




what is included in the operating section of the income statement? - CORRECT

ANSWER (S) --operating revenues

,-costs of goods sold


-selling, general, and admin expenses


-depreciation

---operating income




Adjusting for normal revenues/expenses that are not regarded as principal

operations includes? - CORRECT ANSWER (S) -other income


--Earnings before interest and taxes




Cost of debt financings is what? - CORRECT ANSWER (S) -Interest Expense




Tax expense vs taxes actually paid - CORRECT ANSWER (S) --taxable income


-Taxes


--currently due


--chg in deferred

, Disposition of income is? - CORRECT ANSWER (S) -Dividends


Retained earnings




is net income the same as net cash flow? - CORRECT ANSWER (S) -GAAP -

matching principle of GAAP dictates that revenues be match with expenses.




income is reported when it is earned, even though no cash flow may have occured




Cash inflows are a - CORRECT ANSWER (S) -source of cash




Cash outflows are a - CORRECT ANSWER (S) -use of cash




Accurals definition? - CORRECT ANSWER (S) -accounting recognizes revenue and

expenses when a transaction occurs, not when a cash flow occurs.