1
C214 Practice Test 2025/2026 Exam
Questions and Corresponding Answers
with Surety of 100% Pass Mark
1. A firm reported the following:
Net Income 100,000
Depreciation 25,000
Change in NWC 15,000
What is the CFO (cash flow from operations)?
a. 100,000
b. 110,000
c. 120,000
d. (130,000) - 🧠 ANSWER ✔✔CFO = Net Income + Depreciation - Increase NWC
=100,000 + 25,000 - 15,000
2. What is the Cash Flow from Investing?
COPYRIGHT©NINJANERD 2025/2026. YEAR PUBLISHED 2025. COMPANY REGISTRATION NUMBER: 619652435. TERMS OF USE. PRIVACY
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STATEMENT. ALL RIGHTS RESERVED
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Beginning Net PP&E 50,000
Ending Net PP&E 200,000
Depreciation Expense 40,000
a. (190,000)
b. 150,000
c. 200,000
d. (150,000) - 🧠 ANSWER ✔✔Cash Flow Investing (CFI)
Change in Investment = (Change in Net PPE + Depreciation)
=(200,000 - 50,000) + 40,000
Change Invest = 190,000
CFI = (-1) * Change in Invest = (190,000)
3. What is the Cash Flow from Financing?
Accounts Payable 50,000
Stock Issuance 75,000
Increase in Bonds Payable 125,000
COPYRIGHT©NINJANERD 2025/2026. YEAR PUBLISHED 2025. COMPANY REGISTRATION NUMBER: 619652435. TERMS OF USE. PRIVACY
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STATEMENT. ALL RIGHTS RESERVED
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Dividends Paid 80,000
a. 150,000
b. 120,000
c. 100,000
d. 145,000 - 🧠 ANSWER ✔✔Cash Flow Financing
CFF = Increase in Stock + Increase in Debt - Dividends Paid
=75,000+125,000-80,000
=120,000
4. A couple wants to save for a down payment on a house. They think they need to
accumlate 100,000 in five years. If the interest rate is 5% and they start at the end
of the year when they both get bonuses from their employers, what do they have to
put aside annually?
a. 22,096
b. 17,752
c. 18,097
d. 18,462 - 🧠 ANSWER ✔✔100,000 FV
COPYRIGHT©NINJANERD 2025/2026. YEAR PUBLISHED 2025. COMPANY REGISTRATION NUMBER: 619652435. TERMS OF USE. PRIVACY
3
STATEMENT. ALL RIGHTS RESERVED
, 4
5N
5 I/Y
Cpt PMT = 18,097
5. Hedgeco had sales of 70,000,000, expenses of 50,000,000 and has a 40% tax
rate. It has equity of 40,000,000. The board approved dividends of 4,000,000.
What is the company's Sustainable Growth Rate?
a. 20%
b. 15%
c. 25%
d. 14% - 🧠 ANSWER ✔✔SGR = ROE * ( 1 - Payout Ratio )
ROE = Net Income / Equity
Payout Ratio = Dividends Paid / Net Income
Net Income = (70 - 50)*(1-0.4) = 12 ROE = 12/40 = 0.30
Payout Ratio = 4/12 = .33
SGR = .30 * (1 - 0.33) = .20
6. A company wishes to issue 10 year semi-annual pay bonds with a face value of
$1,000 and a coupon rate of 5%. The market has shifted before the issuance and
COPYRIGHT©NINJANERD 2025/2026. YEAR PUBLISHED 2025. COMPANY REGISTRATION NUMBER: 619652435. TERMS OF USE. PRIVACY
4
STATEMENT. ALL RIGHTS RESERVED
C214 Practice Test 2025/2026 Exam
Questions and Corresponding Answers
with Surety of 100% Pass Mark
1. A firm reported the following:
Net Income 100,000
Depreciation 25,000
Change in NWC 15,000
What is the CFO (cash flow from operations)?
a. 100,000
b. 110,000
c. 120,000
d. (130,000) - 🧠 ANSWER ✔✔CFO = Net Income + Depreciation - Increase NWC
=100,000 + 25,000 - 15,000
2. What is the Cash Flow from Investing?
COPYRIGHT©NINJANERD 2025/2026. YEAR PUBLISHED 2025. COMPANY REGISTRATION NUMBER: 619652435. TERMS OF USE. PRIVACY
1
STATEMENT. ALL RIGHTS RESERVED
,2
Beginning Net PP&E 50,000
Ending Net PP&E 200,000
Depreciation Expense 40,000
a. (190,000)
b. 150,000
c. 200,000
d. (150,000) - 🧠 ANSWER ✔✔Cash Flow Investing (CFI)
Change in Investment = (Change in Net PPE + Depreciation)
=(200,000 - 50,000) + 40,000
Change Invest = 190,000
CFI = (-1) * Change in Invest = (190,000)
3. What is the Cash Flow from Financing?
Accounts Payable 50,000
Stock Issuance 75,000
Increase in Bonds Payable 125,000
COPYRIGHT©NINJANERD 2025/2026. YEAR PUBLISHED 2025. COMPANY REGISTRATION NUMBER: 619652435. TERMS OF USE. PRIVACY
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STATEMENT. ALL RIGHTS RESERVED
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Dividends Paid 80,000
a. 150,000
b. 120,000
c. 100,000
d. 145,000 - 🧠 ANSWER ✔✔Cash Flow Financing
CFF = Increase in Stock + Increase in Debt - Dividends Paid
=75,000+125,000-80,000
=120,000
4. A couple wants to save for a down payment on a house. They think they need to
accumlate 100,000 in five years. If the interest rate is 5% and they start at the end
of the year when they both get bonuses from their employers, what do they have to
put aside annually?
a. 22,096
b. 17,752
c. 18,097
d. 18,462 - 🧠 ANSWER ✔✔100,000 FV
COPYRIGHT©NINJANERD 2025/2026. YEAR PUBLISHED 2025. COMPANY REGISTRATION NUMBER: 619652435. TERMS OF USE. PRIVACY
3
STATEMENT. ALL RIGHTS RESERVED
, 4
5N
5 I/Y
Cpt PMT = 18,097
5. Hedgeco had sales of 70,000,000, expenses of 50,000,000 and has a 40% tax
rate. It has equity of 40,000,000. The board approved dividends of 4,000,000.
What is the company's Sustainable Growth Rate?
a. 20%
b. 15%
c. 25%
d. 14% - 🧠 ANSWER ✔✔SGR = ROE * ( 1 - Payout Ratio )
ROE = Net Income / Equity
Payout Ratio = Dividends Paid / Net Income
Net Income = (70 - 50)*(1-0.4) = 12 ROE = 12/40 = 0.30
Payout Ratio = 4/12 = .33
SGR = .30 * (1 - 0.33) = .20
6. A company wishes to issue 10 year semi-annual pay bonds with a face value of
$1,000 and a coupon rate of 5%. The market has shifted before the issuance and
COPYRIGHT©NINJANERD 2025/2026. YEAR PUBLISHED 2025. COMPANY REGISTRATION NUMBER: 619652435. TERMS OF USE. PRIVACY
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STATEMENT. ALL RIGHTS RESERVED
