CFI CBCA CORE COURSE ASSESSMENTS QUESTIONS WITH
DETAILED VERIFIED AND 100% ACCURATE ANSWERS
What is the main goal of using business writing fundamentals? Correct
Answers To reduce mental effort
Which of the following statements describes a "Capacity" strength or
weakness for a company in the 5 Cs of credit framework? Correct
Answers The net profit margin ratio is high.
Which of the following statements describes a "Condition" strength or
weakness for a company in the 5 Cs of credit framework? Correct
Answers The risks associated with the industry are high.
Which of the following scenarios would NOT be considered a strength
when assessing the management team as part of evaluating a company's
character? Correct Answers Financial reports are not widely shared and
performance measures have not been identified.
Which of the following ratios most likely indicates strong "Capacity" for
a company? Correct Answers High asset turnover ratio
Select the correct formula to calculate the operating margin ratio.
Correct Answers Operating Margin Ratio = EBIT / Revenue
Select the correct formula to calculate the inventory turnover ratio.
Correct Answers Inventory Turnover Ratio = Cost of Goods Sold /
Average Inventory
,Which of the following most likely indicates strong "Capital" for a
company? Correct Answers Unutilized lines of credit or loans
Which of the following statements on collateral is NOT correct? Correct
Answers Collateral can be used as the main determinant of a credit
decision.
Which of the following tools or methods is used to assess the general
business environment? Correct Answers PEST analysis
Select the loan contract with the lowest risk. Correct Answers A demand
loan with monthly payments secured by assets
Which is not one of the three main financial statements? Correct
Answers Statement of equity
What does the balance sheet indicate? Correct Answers The financial
strength of the business
Financing activities Correct Answers Issuing shares and bonds
Operating activities Correct Answers Payments to suppliers;
Depreciation and amortization expense
,Investing activities Correct Answers Buying and selling equipment
Which is not a section in the financial statement note disclosures?
Correct Answers Management discussion and analysis
Balance Sheet Correct Answers Retained earnings; Share captial
Income Statement Correct Answers Rent expense
Cash Flow Statement Correct Answers Sale of property, plant and
equipment
If a company has net assets equal to $3.25 million but is sold for $5.35
million, how much goodwill does the acquirer record on their balance
sheet? Correct Answers $2.1 million
Intangible assets Correct Answers Items of value, which have no
physical substance, that are used to generate revenues
Authorized shares Correct Answers The total number of shares a
company can sell
Contingencies Correct Answers Events that may or may not happen,
depending on certain circumstances
, Commitments Correct Answers Future obligations that a company has
agreed to
If a company issues 60,000 shares at $0.25 each but the shares have a
par value of $0.20 each, what is the resulting contributed surplus?
Correct Answers $3,000
What line item is not found in the statement of shareholders' equity?
Correct Answers Debt issued or repurchased
What is not true about a partnership? Correct Answers Partners cannot
be held liable for a debt
Which line item usually accounts for direct labor? Correct Answers Cost
of goods sold
Select the statements below which are true. Select all that apply. Correct
Answers Depreciation and amortization are non-cash expenses; A
company can be profitable but experience negative cash flows
What are the 4 types of audit opinions? Correct Answers Adverse,
unqualified, qualified, and disclaimer of opinion
Which of the following statements regarding a review engagement is
false? Correct Answers A review engagement is used for financial
statements prepared for internal use
DETAILED VERIFIED AND 100% ACCURATE ANSWERS
What is the main goal of using business writing fundamentals? Correct
Answers To reduce mental effort
Which of the following statements describes a "Capacity" strength or
weakness for a company in the 5 Cs of credit framework? Correct
Answers The net profit margin ratio is high.
Which of the following statements describes a "Condition" strength or
weakness for a company in the 5 Cs of credit framework? Correct
Answers The risks associated with the industry are high.
Which of the following scenarios would NOT be considered a strength
when assessing the management team as part of evaluating a company's
character? Correct Answers Financial reports are not widely shared and
performance measures have not been identified.
Which of the following ratios most likely indicates strong "Capacity" for
a company? Correct Answers High asset turnover ratio
Select the correct formula to calculate the operating margin ratio.
Correct Answers Operating Margin Ratio = EBIT / Revenue
Select the correct formula to calculate the inventory turnover ratio.
Correct Answers Inventory Turnover Ratio = Cost of Goods Sold /
Average Inventory
,Which of the following most likely indicates strong "Capital" for a
company? Correct Answers Unutilized lines of credit or loans
Which of the following statements on collateral is NOT correct? Correct
Answers Collateral can be used as the main determinant of a credit
decision.
Which of the following tools or methods is used to assess the general
business environment? Correct Answers PEST analysis
Select the loan contract with the lowest risk. Correct Answers A demand
loan with monthly payments secured by assets
Which is not one of the three main financial statements? Correct
Answers Statement of equity
What does the balance sheet indicate? Correct Answers The financial
strength of the business
Financing activities Correct Answers Issuing shares and bonds
Operating activities Correct Answers Payments to suppliers;
Depreciation and amortization expense
,Investing activities Correct Answers Buying and selling equipment
Which is not a section in the financial statement note disclosures?
Correct Answers Management discussion and analysis
Balance Sheet Correct Answers Retained earnings; Share captial
Income Statement Correct Answers Rent expense
Cash Flow Statement Correct Answers Sale of property, plant and
equipment
If a company has net assets equal to $3.25 million but is sold for $5.35
million, how much goodwill does the acquirer record on their balance
sheet? Correct Answers $2.1 million
Intangible assets Correct Answers Items of value, which have no
physical substance, that are used to generate revenues
Authorized shares Correct Answers The total number of shares a
company can sell
Contingencies Correct Answers Events that may or may not happen,
depending on certain circumstances
, Commitments Correct Answers Future obligations that a company has
agreed to
If a company issues 60,000 shares at $0.25 each but the shares have a
par value of $0.20 each, what is the resulting contributed surplus?
Correct Answers $3,000
What line item is not found in the statement of shareholders' equity?
Correct Answers Debt issued or repurchased
What is not true about a partnership? Correct Answers Partners cannot
be held liable for a debt
Which line item usually accounts for direct labor? Correct Answers Cost
of goods sold
Select the statements below which are true. Select all that apply. Correct
Answers Depreciation and amortization are non-cash expenses; A
company can be profitable but experience negative cash flows
What are the 4 types of audit opinions? Correct Answers Adverse,
unqualified, qualified, and disclaimer of opinion
Which of the following statements regarding a review engagement is
false? Correct Answers A review engagement is used for financial
statements prepared for internal use
