Business Finance - Peregrine Section Review Questions With Revised Answers
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Course
Peregrine
Institution
Peregrine
Business Finance - Peregrine Section Review
Questions With Revised Answers
A company's balance sheet shows the value of assets, liabilities, and stockholders' equity _____.
A. for any given period of time
B. at a specific point in time
C. at the end of the fiscal year - answerB. at a specific ...
Business Finance - Peregrine Section Review
Questions With Revised Answers
A company's balance sheet shows the value of assets, liabilities, and stockholders' equity _____.
A. for any given period of time
B. at a specific point in time
C. at the end of the fiscal year - answer✔✔B. at a specific point in time
Match the ratios to their ratio type.
A. Debt Ratios
B. Activity Ratios
C. Market Ratios
D. Liquidity Ratios
E. Profitability Ratios
Current Ratio & Quick (Acid Test) Ratio
Turnover ratios & Collection/Payment Period
Debt-to-Equity Ratio & Times Interest Earned (TIE)
Price/Earnings (P/E) Ratio & Market-to-Book Ratio - answer✔✔A. Debt Ratios: Debt-to-Equity
Ratio & Times Interest Earned (TIE)
B. Activity Ratios: Turnover ratios & Collection/Payment Period
C. Market Ratios: Price/Earnings (P/E) Ratio & Market-to-Book Ratio
D. Liquidity Ratios: Current Ratio & Quick (Acid Test) Ratio
E. Profitability Ratios: Profit Margin & Return on Assets
Balance Sheet Assets - answer✔✔Cash and cash equivalents are assets such as checking account
balances at commercial banks that can be used directly as means of payment.
Marketable securities represent liquid short-term investments, which financial analysts view as a
form of "near cash." They include Treasury notes, commercial paper, and others.
Accounts receivable represent the amount customers owe the firm from sales made on credit.
Inventories include raw materials, work in process (partially finished goods), and finished goods
held by the firm.
Intangible assets include items such as patents, trademarks, copyrights, or mineral rights entitling
the company to extract oil and gas on specific properties.
Gross property, plant, and equipment (PP&E) is the original cost of all real property, structures,
and long-lived equipment owned by the firm.
Net property, plant, and equipment is calculated as Gross PP&E less accumulated depreciation -
the cumulative expense recorded for the depreciation of fixed assets since their purchase; this
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