This quiz works best with JavaScript enabled. Home > Corporate Finance > Corporate Finance > Corporate Finance – Quiz 32 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Corporate Finance Quiz 32 (20 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. A company has a debt/equity ratio equal to 1.10. The rate of return on assets (ROA) is 6.5% and the total value of Net assets is $ 210, 000. The equity multiplier (MAF) and the company's net profit are, respectively, from:Note:consult the Dupont diagram A) 0.48 and R$ 13, 650.00. B) 2.10 and R$ 13, 650.00. C) 2.10 and R$ 28, 665.00. D) 0.48 and R$ 28, 665.00. Show Answer Correct Answer: C) 2.10 and R$ 28, 665.00. 2. ..... is anything that you buy for the purpose of deriving greater value than you spent to acquire it. A) Investment. B) Divestment. C) Exchange. D) Transaction. Show Answer Correct Answer: A) Investment. 3. The Galley purchased some 3-year MACRS property two years ago at a cost of $ 19, 800. The MACRS rates are 33.33 percent, 44.44 percent, 14.82 percent, and 7.41 percent. The firm no longer uses this property so is selling it today at a price of $ 13, 500. What is the amount of the aftertax profit on the sale? Assume the firm applies bonus depreciation and has a tax rate of 21 percent. A) $ 10, 665.00. B) $ 8, 295.00. C) $ 7, 187.78. D) $ 10, 702.40. Show Answer Correct Answer: A) $ 10, 665.00. 4. What is the subject name for BAC2644? A) Principle of Finance. B) Financial Management. C) Principle of Corporate Finance. D) Corporate Finance. Show Answer Correct Answer: D) Corporate Finance. 5. Analysis reports in the form of Return on Equity (ROE), Return on Assets (ROA), Earning Power of Total Investment (EPTI), Gross Profit Margin (GPM), and Operating Income (OI). is part of the ratio A) Profitability. B) Asset Management. C) Debt Management. D) Market value. Show Answer Correct Answer: A) Profitability. 6. Owners of large, diversified stock portfolios can hedge against sharp price declines in stocks by ..... A) Buy a call option on a stock index. B) Buy a put option on a stock index. C) Selling a put option on a stock index. D) Buying a call option and a put option with the same expiration date. Show Answer Correct Answer: B) Buy a put option on a stock index. 7. Method of capital budgeting, except: A) NPV (Net Present Value). B) IRR (Internal Rate of Return). C) MIRR (Modified Internal Rate of Return). D) Index Number. Show Answer Correct Answer: D) Index Number. 8. Modigliani and Miller's Proposition I states that A) The market value of a firm's common stock is independent of its capital structure. B) The market value of a firm's debt is independent of its capital structure. C) The market value of any firm is independent of its capital structure. D) None of these options. Show Answer Correct Answer: C) The market value of any firm is independent of its capital structure. 9. ..... presents how much money a firm makes during a particular period of time. A) The balance sheet. B) The income statement. C) Both. D) None of them. Show Answer Correct Answer: B) The income statement. 10. Account receivable:455; total assets:2756.What is the common-size of account receivable? A) 16.51%. B) 6.05%. C) 22.3%. D) 40.35%. Show Answer Correct Answer: A) 16.51%. 11. ..... is mentioned in the memorandum of association. A) Face value. B) Market value. Show Answer Correct Answer: A) Face value. 12. Gain from mergers is defined as:Gain = PVAB-(PVA + PVB) A) True. B) False. Show Answer Correct Answer: A) True. 13. What is the primary aim of financial accounting? A) To keep information confidential. B) To manage human resources. C) To keep the world in the loop. D) To handle marketing strategies. Show Answer Correct Answer: A) To keep information confidential. 14. It is the periodic interest payment that the bond holder receives during the time between purchase date and maturity date, usually receives semi annually. A) Bond. B) Coupon. C) Issuer. D) Dividend. Show Answer Correct Answer: B) Coupon. 15. Which of the following is NOT a type of required capital? A) Start-up. B) Operating. C) Reserve. D) Expense. Show Answer Correct Answer: D) Expense. 16. Which of the following would not be financed from working capital? A) Accounts receivable. B) Cash float. C) Credit sales. D) A new personal computer for the office. Show Answer Correct Answer: D) A new personal computer for the office. 17. What would you expect to happen to the price of a share of stock on the day it goes ex-dividend? The price should: A) Increase by the amount of the dividend. B) Decrease by the amount of the dividend. C) Decrease by one-half the amount of the dividend. D) Remain constant. Show Answer Correct Answer: B) Decrease by the amount of the dividend. 18. A will buy 1 gram of gold. A will buy gold in 3 months at a price of IDR 100, 000 per gram and a premium of IDR 10, 000 per gram. If the price 3 months later is IDR 150, 000 per gram, will A exercise his rights or not? A) Exercise the right to buy. B) Not exercising the right to buy. C) You can exercise or not. D) None of above. Show Answer Correct Answer: A) Exercise the right to buy. 19. What are costs which vary with output called? A) Overhead costs. B) Indirect costs. C) Prime costs. D) All of the above. Show Answer Correct Answer: A) Overhead costs. 20. Capital equipment costing $ 250, 000 today has 50, 000 salvage value at the end of 5 years. If the straight line depreciation method is used, what is the book value of the equipment at the end of two years? A) $ 200, 000. B) $ 170, 000. C) $ 140, 000. D) $ 50, 000. Show Answer Correct Answer: B) $ 170, 000. ← PreviousNext →Related QuizzesCorporate Finance QuizzesCorporate Finance Quiz 1Corporate Finance Quiz 2Corporate Finance Quiz 3Corporate Finance Quiz 4Corporate Finance Quiz 5Corporate Finance Quiz 6Corporate Finance Quiz 7Corporate Finance Quiz 8Corporate Finance Quiz 9 🏠 Back to Homepage 📘 Download PDF Books 📕 Premium PDF Books