FIN 340 Exam 1 ACTUAL Exam Questions and CORRECT Answers

FIN 340 Exam 1 ACTUAL Exam Questions
and CORRECT Answers
What is the annual report, and what two types of information does it provide? - CORRECT
ANSWER - most important report that corporations issue to stockholders, verbal section-
letter from the chairperson, second - financial statements


What four financial statements are typically included in the annual report? - CORRECT
ANSWER - Balance Sheet
Income statement
Statement of cash flows
statement of stockholders equity


Why is the annual report of great interest to investors? - CORRECT ANSWER - tells what
happened to its assets and explains earnings for the year


How is the order in which items are shown on the balance sheet determined? - CORRECT
ANSWER - The left side is the assets, right is liabilities and equity



What is the balance sheet, and what information does it provide? - CORRECT ANSWER -
a "snapshot" of a firm's position at a specific point in time


Explain in words the difference between net working capital and net operating working capital. -
CORRECT ANSWER -


Explain in words the difference between total debt and total liabilities - CORRECT
ANSWER -


Why is earnings per share called "the bottom line"? What is EBIT, or operating income? -
CORRECT ANSWER -