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BMAL 590 Business Finance
Exam Questions and Verified
Answers|Latest update
A company's balance sheet shows the value of assets, liabilities, and
stockholders' equity - Correct-Answer-At a specific point in time
On a balance sheet, retained earnings are not "unspent cash" because -
Correct-Answer-They have been used to finance the firm's assets
For both managers and external financial analysts, ________ is the
single most important accounting number found on the income
statement - Correct-Answer-Net income (net profit after tax)
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Earnings per share (EPS) is calculated by - Correct-Answer-Dividing
earnings available for common stockholders by the number of shares of
common stock outstanding
Net working capital - Correct-Answer-Is a measure of a firm's overall
liquidity
Why is the quick ratio a more appropriate measure of liquidity than the
current ratio for a large-airplane manufacturer? - Correct-Answer-It
excludes inventory from the numerator of the ratio because it is
difficult to convert inventory to cash and most sales are made on a
credit basis
The one fixed asset that is not depreciated is _________ - Correct-
Answer-Land
Return on total assets (ROA) is equal to _________ - Correct-Answer-All
of the above
BMAL 590 Business Finance
Exam Questions and Verified
Answers|Latest update
A company's balance sheet shows the value of assets, liabilities, and
stockholders' equity - Correct-Answer-At a specific point in time
On a balance sheet, retained earnings are not "unspent cash" because -
Correct-Answer-They have been used to finance the firm's assets
For both managers and external financial analysts, ________ is the
single most important accounting number found on the income
statement - Correct-Answer-Net income (net profit after tax)
, Page |2
Earnings per share (EPS) is calculated by - Correct-Answer-Dividing
earnings available for common stockholders by the number of shares of
common stock outstanding
Net working capital - Correct-Answer-Is a measure of a firm's overall
liquidity
Why is the quick ratio a more appropriate measure of liquidity than the
current ratio for a large-airplane manufacturer? - Correct-Answer-It
excludes inventory from the numerator of the ratio because it is
difficult to convert inventory to cash and most sales are made on a
credit basis
The one fixed asset that is not depreciated is _________ - Correct-
Answer-Land
Return on total assets (ROA) is equal to _________ - Correct-Answer-All
of the above
