HM 435 FINAL EXAM QUESTIONS WITH
VERIFIED ANSWERS
Equity capital is provided by the:
A) auditors of the company
B) creditors of the company
C) lenders to the company
D) owners of the company - ANSWER D) owner of the company
REVPAR is a combination of which following ratios?
A) paid occupancy percentage and average daily rate
B) number of rooms sold and paid occupancy %
C) number of available rooms and average daily rate
D) profit margin and average occupancy per room - ANSWER A) Paid occupancy
percentage and average daily rate
The Orange Inn had $300,000 of beverage sales during June (30 Days) and a beverage
cost of sales percentage of 22% for the month. If its average beverage inventory totals
$22,000, what is its beverage inventory turnover, and how many days' supply of
beverage inventory is on hand at the end of the month?
A) 3 times; 15 days
B) 3 times; 10 days
C) 2 times; 15 days
D: 2 times; cannot be determined - ANSWER B) 3 times; 10 days
The purchase of a building would be shown as a ________ activity on a firm's statement of
cash flows.
A) operating
B) financing
C) investing
D) none of the above - ANSWER C)Investing
, Which of the following financial decisions produces sales and income?
A) financing
B) dividend
C) investing
D) accounting - ANSWER C) Investing
Food cost for 2020 was 31.5% whereas food cost for 2019 was 32.1%. Which conclusion
can be drawn from this performance?
A) Food cost in 2020 increased at a larger % than sales compared to 2019
B) Food cost in 2020 increased at the same rate as sales compared to 2019
C: Food cost in 2020 increase at a smaller % than sales compared to 2019
D) Cannot determine without knowing the specific sales % increase. - ANSWER C)Food
cost in 2020 increase at a smaller % than sales compared to 2019
The Blue Club has assets of $6 Million, current liabilities of $800,000, long-term debt of
$2.2 Million and owners' equity equal to $3 million. Its leverage ratio is:
A) 26.7%
B) 13.3%
C) 50%
D: 42.3% - ANSWER D) 42.3%
Suppliers of debt capital have ________ to the income and assets of a hospitality
company
A: an ownership claim
B: a lower claim than the owners
C: no claim
D: a legally protected prior claim - ANSWER D) a legally protected prior claim
The value today of a claim to a future risky dividend stream is a function of:
A: the magnitude of the future dividends
B: the timing of the future dividends
C: the risk related to the future dividends
D: all of the above - ANSWER D) all of the above
VERIFIED ANSWERS
Equity capital is provided by the:
A) auditors of the company
B) creditors of the company
C) lenders to the company
D) owners of the company - ANSWER D) owner of the company
REVPAR is a combination of which following ratios?
A) paid occupancy percentage and average daily rate
B) number of rooms sold and paid occupancy %
C) number of available rooms and average daily rate
D) profit margin and average occupancy per room - ANSWER A) Paid occupancy
percentage and average daily rate
The Orange Inn had $300,000 of beverage sales during June (30 Days) and a beverage
cost of sales percentage of 22% for the month. If its average beverage inventory totals
$22,000, what is its beverage inventory turnover, and how many days' supply of
beverage inventory is on hand at the end of the month?
A) 3 times; 15 days
B) 3 times; 10 days
C) 2 times; 15 days
D: 2 times; cannot be determined - ANSWER B) 3 times; 10 days
The purchase of a building would be shown as a ________ activity on a firm's statement of
cash flows.
A) operating
B) financing
C) investing
D) none of the above - ANSWER C)Investing
, Which of the following financial decisions produces sales and income?
A) financing
B) dividend
C) investing
D) accounting - ANSWER C) Investing
Food cost for 2020 was 31.5% whereas food cost for 2019 was 32.1%. Which conclusion
can be drawn from this performance?
A) Food cost in 2020 increased at a larger % than sales compared to 2019
B) Food cost in 2020 increased at the same rate as sales compared to 2019
C: Food cost in 2020 increase at a smaller % than sales compared to 2019
D) Cannot determine without knowing the specific sales % increase. - ANSWER C)Food
cost in 2020 increase at a smaller % than sales compared to 2019
The Blue Club has assets of $6 Million, current liabilities of $800,000, long-term debt of
$2.2 Million and owners' equity equal to $3 million. Its leverage ratio is:
A) 26.7%
B) 13.3%
C) 50%
D: 42.3% - ANSWER D) 42.3%
Suppliers of debt capital have ________ to the income and assets of a hospitality
company
A: an ownership claim
B: a lower claim than the owners
C: no claim
D: a legally protected prior claim - ANSWER D) a legally protected prior claim
The value today of a claim to a future risky dividend stream is a function of:
A: the magnitude of the future dividends
B: the timing of the future dividends
C: the risk related to the future dividends
D: all of the above - ANSWER D) all of the above
