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Corporate Finance Final Exam With Questions And 100% SURE ANSWERS
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JACKLINECorporate Finance Final Exam With Questions And 100% SURE ANSWERS
Terms in this set (167)
Investors buy debt or equity of the Firm with cash: Depends
Financing Decision - how should the firm raise the
cash/capital to pay for the firm's assets?
External finance involves selling a financial claim -
why choose debt or equity?
Debt - a contractual claim entitles investor to
receive fixed interest payments at specified dates
Equity - a residual claim entitles ownership in firm
Who gets "paid" first?
Neither
Debt holders
Equity holders
Depends
Corporate Finance Final Exam
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,Investment Decision - what real assets do we want Capital Budgeting
to purchase with the cash?
Operating Decision - how should the firm use
assets in each period?
What is the most important relationship between
Investing and Operating decisions?
Cash Outflow vs. Cash Inflow
Capital Budgeting
No relationship
Both Firm Decisions
4a) Firm reinvests cash in the Firm's Operations Depends
4b) Firm pays out cash to investors
Payout Decision - how should the Firm divide up
operating cash flows into cash distributed to
investors and cash reinvested in the firm's
operations and assets
Is this a cash inflow or outflow?
Cash Outflow
Cash Inflow
Both
Depends
Firm Manager Objectives: What is the manager's Maximize the equity value of the Firm
primary objective?
Maximize the enterprise value of the Firm
Avoid financial distress and bankruptcy
Maximize Profit
Maximize the equity value of the Firm
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,4a) Firm reinvests cash in the Firm's Operations Cash Outflow or Neither
4b) Firm pays out cash to investors
Payout Decision - how should the Firm divide up
operating cash flows into cash distributed to
investors and cash reinvested in the firm's
operations and assets
Is this a cash inflow or outflow?
Cash Outflow
Cash Outflow or Neither
Cash Inflow
Both
What are the five key strategic financial decisions Financing, Investing, Operating, Payout, Liquidity
that a firm must make?
Financing, Investing, Operating, Payout, Liquidity
Financing, Capital Budgeting, Payout, Add
Liquidity, Draw Down Liquidity
Financing, Investing, Capital Budgeting, Payout,
Liquidity
Capital Structure, Investing, Operating, Payout,
Liquidity
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, 9/10/24, 9:24 AM
Finance Interview Question: How does a $10mm Net Income decreases by $7m, Cash Flow from Operations increases by $3m, Cash is up $3m,
increase in Depreciation flow through the three Net PP&E down $10m, Retained Earnings down $7m
financial statements?
Assume 30% tax rate
Net Income decreases by $10m, Cash Flow from
Operations decreases by $10m, Cash is down
$10m, Retained Earnings down $10m
Net Income decreases by $3m, Cash Flow from
Operations increases by $7m, Cash is up $7m, Net
PP&E down $10m, Retained Earnings down $3m
Net Income decreases by $7m, Cash Flow from
Operations increases by $3m, Cash is up $3m, Net
PP&E down $10m, Retained Earnings down $7m
No answer text provided.
Where is Cost of Goods Sold (COGS)? Other Costs of Revenue
Selling and Marketing
Research and Development
Other Costs of Revenue
General and Administrative
What is EBIT? How would it be calculated using Earnings Before Interest and Taxes = Operating Income + Other, net
this information?
Earnings Before Interest and Taxes = Operating
Income
Earnings Before Interest and Taxes = Operating
Income + Other, net
Earnings Before Income and Taxes = Operating
Income + Other, net
Earnings Before Income and Taxes = Operating
Income + Interest
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