Fin 3400 - Study guides, Class notes & Summaries

FIN 3400 Chapter 14 Assignment Questions and Answers- Florida International University Select all that apply Which of these can cause a firm to incur shortage costs? Select all that apply. Multiple select question. Granting too little credit to customers Being out of an inventory item Borrowing too much from suppliers Having too little cash on hand A firm should try to equal the marginal benefit of each dollar invested in net working capital with which one of these? Multiple choice que...

FIN 3400 Chapter 03 Assignment Questions and Answers- Florida International University The Shoe Store has cash of $300, accounts receivable of $700, accounts payable of $800, inventory of $1,300, long-term debt of $1,900, and notes payable in three months of $500. What is the current ratio? Multiple choice question. 2.14 2.88 1.77 0.72 Reason: Current assets = $300 + $700 + $1,300 = $2,300 Current liabilities = $800 + $500 = $1,300 Current ratio = $2,300/$1,300 = 1.77 Jen's has curr...

FIN 3400 Chapter 09 Assignment Questions and Answers- Florida International University True or false: A high-risk investment can underperform a low-risk investment over the short term. True false question. True False How is the term "dollar return" defined? Multiple choice question. Amount of profit or loss expressed as an annual rate Amount of profit or loss from an investment expressed as a percentage of the ending price Amount of profit or loss from an investment expressed in dolla...

FIN 3400 Chapter 02 Assignment Questions and Answers- Florida International University Which one of these is not one of the four basic financial statements? Multiple choice question. Statement of ratios Balance sheet Statement of cash flows Income statement Which one of these correctly defines the balance sheet identity? Multiple choice question. Liabilities - Equity = Assets Equity = Assets - Liabilities Liabilities = Assets + Equity Equity = Assets + Liabilities A firm has fixed a...

FIN 3400 Chapter 10 Assignment Questions and Answers- Florida International University Select all that apply Which of the following will decrease the risk level of a firm? Select all that apply. Multiple select question. Selling the lowest-risk division Accepting riskier projects Accepting a low-risk project Acquiring a less risky firm Which one of these best illustrates a probability distribution at it relates to next year's economy? Multiple choice question. 15 percent chance of a b...

FIN 3400 Chapter 06 Assignment Questions and Answers- Florida International University How is a primary market defined? Multiple choice question. A primary market is the market in which a handful of institutions purchase an entire issue of securities. A primary market is the sale of any security that has been registered with the SEC. A primary market is a market in which corporations and other fund demanders obtain funds by issuing new securities. The primary market is defined as the ma...

FIN 3400 Chapter 05 Assignment Questions and Answers- Florida International University You plan to invest $300 today and $500 three years from today. Two years from today, you plan to withdraw $50. Which of these is a correct statement regarding a time line for computing the future value of your cash flows four years from today? Multiple choice question. The cash flow at year 4 is a negative $500. The cash flow at time 0 is a positive $300. The cash flow at year 2 is a negative $50. The...

FIN 3400 Chapter 07 Assignment Questions and Answers- Florida International University Which of these statements is correct? Multiple choice question. The value of the bond market is about half of the value of the stock market. The average daily trading volume of the U. S. bond market exceeds $800 billion. The bond market is an insignificant source of funds for business firms. The U. S. bond market consists of only government-issued bonds. What is an indenture agreement? Multiple choic...

FIN 3400 Chapter 08 Assignment Questions and Answers- Florida International University Select all that apply Which of these apply to publicly-issued common stock? Select all that apply. Multiple select question. Ownership position Valueless security unless dividends are currently being paid Value determined on the stock exchanges Stock value depends on the issuer's business success How important is the liquidity provided by stock exchanges to the equity markets? Multiple choice questi...

FIN 3400 Chapter 11 Assignment Questions and Answers- Florida International University What does a firm-wide WACC represent? Multiple choice question. A firm's overall cost of financing A firm's overall rate of return The current yield on a firm's outstanding debt A firm's expected return on its investments A firm funds its operations with $50 of common stock, $30 of preferred stock, and $40 of debt. The component costs are: common = 12 percent; preferred = 10 percent; pretax debt = ...