Question

The 2015 balance sheet of Global Tours showed current assets of $1,360 and current liabilities of $940. The 2016 balance sheet showed current assets of $1,640 and current liabilities of $1,140. What was the change in net working capital for 2016?

		$80
		$880
		$920
		$190
		$170

Bonner Collision has shareholders' equity of $141,800. The firm owes a total of $126,000 of which 60 percent is payable within the next year. The firm net fixed assets of $161,900. What is the amount of the net working capital?

		$75,600
		$30,300
		$25,300
		$111,500
		$86,300

Your sister deposited $5,000 today at 8.5 percent interest for 5 years. You would like to have just as much money at the end of the next 5 years as your sister will have. However, you can only earn 7 percent interest. How much more money must you deposit today than your sister did if you are to have the same amount at the end of the 5 years?

		$387.78
		$321.19
		$360.43
		$401.21
		$413.39

You are scheduled to receive annual payments of $5,100 for each of the next 7 years. The discount rate is 10 percent. What is the difference in the present value if you receive these payments at the beginning of each year rather than at the end of each year?

		$2,483
		$2,804
		$2,721
		$2,513
		$2,727

Which one of the following terms is defined as a conflict of interest between the corporate shareholders and the corporate managers?

		corporate breakdown
		consideration
		articles of incorporation
		agency conflict
		legal liability

Which one of the following terms is defined as the mixture of a firm's debt and equity financing?

		capital investing
		working capital management
		capital structure
		cash management
		capital budgeting

Modern Motors Accessories had annual sales of $1,000,000 last year (December 31, 2017). The company’s cost of goods sold (COGS) accounted for 75% of sales and is expected to be at the same level for the next few years. Its annual depreciation for last year was $50,000 and is not likely to change if production is increased or decreased. The company’s annual interest expense on long-term borrowings was $150,000 and these loans will remain in their books at the same level and on same terms for two more years. The company’s goal is to double its net income for this year ending on December 31, 2018.

The forecast net income for 2018 (desired goal) is $

The forecast sales for accomplishing this goal is $

You would like to have $75,000 towards college education for your child 17 years from now. How much money must you set aside today for this purpose if you can earn 8 percent on your investments?

		$32,488.37
		$18,388.19
		$29,311.13
		$20,270.17
		$28,417.67

Which of the following questions are addressed by financial managers?

I. How should a product be marketed?
II. Should customers be given 30 or 45 days to pay for their credit purchases?
III. Should the firm borrow more money?
IV. Should the firm acquire new equipment?

		I, II, and III only
		I and IV only
		I, II, III, and IV
		II and III only
		II, III, and IV only

A firm has common stock of $6,200, paid-in surplus of $9,100, total liabilities of $8,400, current assets of $5,900, and fixed assets of $21,200. What is the amount of the shareholders' equity?

		$23,700
		$18,700
		$35,500
		$15,300
		$6,900

Kaylor Equipment Rental paid $75 in dividends and $511 in interest expense. The addition to retained earnings is $418 and net new equity is $500. The tax rate is 35 percent. Sales are $15,900 and depreciation is $680. What are the earnings before interest and taxes?

		$1,269.46
		$589.46
		$1,331.54
		$1,951.54
		$1,949.46

You are comparing two annuities with equal present values. The applicable discount rate is 8.75 percent. One annuity pays $5,000 on the first day of each year for 20 years. How much does the second annuity pay each year for 20 years if it pays at the end of each year?

		$5,438
		$5,211
		$5,267
		$5,309
		$5,390

Which one of the following functions should be the responsibility of the controller rather than the treasurer?

		customer credit approval
		payment to a vendor
		equipment purchase analysis
		income tax returns
		daily cash deposit

You collect old coins. Today, you have two coins each of which is valued at $300. One coin is expected to increase in value by 6 percent annually while the other coin is expected to increase in value by 4.5 percent annually. What will be the difference in the value of the two coins 15 years from now?

		254.24
		$208.04
		$138.38
		$241.79
		$280.15

The Design Team just decided to save $1,500 a month for the next 5 years as a safety net for recessionary periods. The money will be set aside in a separate savings account which pays 4.5 percent interest compounded monthly. The first deposit will be made today. What would today's deposit amount have to be if the firm opted for one lump sum deposit today that would yield the same amount of savings as the monthly deposits after 5 years?

		$80,459.07
		$81,548.20
		$81,068.18
		$80,760.79
		$81,068.18

Theresa adds $1,500 to her savings account on the first day of each year. Marcus adds $1,500 to his savings account on the last day of each year. They both earn 6.5 percent annual interest. What is the difference in their savings account balances at the end of 35 years?

		$12,219
		$12,093
		$12,113
		$12,127
		$12,211

When you retire 40 years from now, you want to have $1.2 million. You think you can earn an average of 12 percent on your investments. To meet your goal, you are trying to decide whether to deposit a lump sum today, or to wait and deposit a lump sum 2 years from today. How much more will you have to deposit as a lump sum if you wait for 2 years before making the deposit?

		$3280.78
		$2,319.47
		$2,891.11
		$3,406.78
		$1,414.14

Suppose you are given the following information for Bayside Bakery: sales = $30,000; costs = $15,000; addition to retained earnings = $4,221; dividends paid = $469; interest expense = $1,300; tax rate = 30 percent. What is the amount of the depreciation expense?

		$7,000
		$9,500
		$4,820
		$8,180
		$5,500

Which one of the following is a working capital management decision?

		determining whether or not a project should be accepted
		determining the number of shares of stock to issue to fund an acquisition
		determining the amount of equipment needed to complete a job
		determining whether to pay cash for a purchase or use the credit offered by the supplier
		determining the amount of long-term debt required to complete a project

Andre’s bakery has sales of $687,000 with cost of $429,000. Interest expense is $2600 and depreciation is $42,000. The tax rate is 35%. What is the net income?

44,450

124,550

82,550

86,450

42,750

Answer 1

I have answered questions 1,2,5,6.Hope this helps!

5) The conflict of interest between corporate shareholders and corporate managers is called agency conflict. It arises whenever the managers are not performing as per the best interest of shareholders

6) Mixture of firms debt and equity is called capital structure. It represents the percentage of each contributing to the firms capital