Purchase Solution

Which of the following measures an organization's liquidity?

Not what you're looking for?

Ask Custom Question

1. Which of the following measures an organization's liquidity?
a. acid test ratio
b. debt ratio
c.. return on equity
d. times interest earned
e. return on assets

2. Which of the following is a method by which securities are distributed to final investors?

a. negotiated purpose
b. commission or best effort basis
c. direct sale
d. competitive bid purchase
e. all of the above

3. What is a cash budget?
a. detailed plan of future cash flows
b. a budget that shows only what cash comes in
c. a historical look at cash flows
d. a report that analyzes the cash account
e. a report that analyzes accounts receivable

4. If your revenue is $10 million, your variable cost is $6 million, and your fixed cost is $3 million, what is your contribution margin?
a. $4 million
b. $1 million
c. $3 million
d. $9 million
e. $7 million

5. A project has an initial outflow of $10,000. The project will generate free cash flows of $8,000 per year for two years. The discount rate is 8%. What is this project's net present value (NPV)?
a. $4,250
b. $6,000
c. $4,264
d. $16,000
e. $8,000

6. The 3 primary motives for holding cash are:
a. transactions, speculative, predictive
b. speculative, precautionary, predictive
c. transactions, speculative, storing
d. predictive, storing, speculative
e. transactions, precautionary, speculative

7. What happens to the cost of debt for firms with debt as their corporate tax rates increase?
a. cost of debt increases
b. cost of debt decreases
c. cost of debt remains the same
d. cost of debt can either increase or decrease, depending on the amount of debt
e. cost of debt can either increase or decrease, depending on the percent debt represents of the entire capital structure

8. What is the weighted average cost of capital (WACC) for a firm where debt is 40% of the firm, preferred stock is 10% of the firm, common stock is 50% of the firm, after tax cost of debt is 8%, cost of preferred stock is 12%, and cost of common stock is 18%?
a. 12.00%
b. 12.38%
c. 12.67%
d. 13.40%
e. 16.33%

9. Which of the following is a risk in direct foreign investment?
a. business risk
b. financial risk
c. political risk
d. exchange rate risk
e. all of the above

10. If a Euro is currently equal to 1.1574 US dollars, how many dollars must a US company pay to a European company for an item that costs 1000 Euros?
a. $1,000
b. $864
c. $1,157.40
d. $115.74
e. Cannot be determined with the information given

Attachments
Purchase this Solution
Solution Summary

This solution is comprised of a detailed explanation to answer which of the following measures an organization's liquidity.

Solution Preview

1. Which of the following measures an organization's liquidity?
a. acid test ratio
b. debt ratio
c.. return on equity
d. times interest earned
e. return on assets

Answer: A

2. Which of the following is a method by which securities are distributed to final investors?

a. negotiated purpose
b. commission or best effort basis
c. direct sale
d. competitive bid purchase
e. all of the above

Answer: E

3. What is a cash budget?
a. detailed plan of future cash flows
b. a budget that shows only what cash comes in
c. a historical look at cash flows
d. a report that analyzes the cash account
e. a report that analyzes accounts ...

Purchase this Solution
Free BrainMass Quizzes
Organizational Behavior (OB)

The organizational behavior (OB) quiz will help you better understand organizational behavior through the lens of managers including workforce diversity.

Understanding Management

This quiz will help you understand the dimensions of employee diversity as well as how to manage a culturally diverse workforce.

Business Processes

This quiz is intended to help business students better understand business processes, including those related to manufacturing and marketing. The questions focus on terms used to describe business processes and marketing activities.

Paradigms and Frameworks of Management Research

This quiz evaluates your understanding of the paradigm-based and epistimological frameworks of research. It is intended for advanced students.

MS Word 2010-Tricky Features

These questions are based on features of the previous word versions that were easy to figure out, but now seem more hidden to me.

View More Free Quizzes
Related BrainMass Solutions

  • Finance

    225640 Which of the following ratios measures an organization's liquidity? Which of the following ratios measures an organization's liquidity? a. Acid test ratio b. Debt ratio c. Return on equity d.

  • Financial Analysis (key strengths and weaknesses) of Home De

    The other prominent liquidity ratio is quick ratio which measures the near term liquidity of the organization. It is computed by Quick Assets/Current Liabilities.

  • Description of Liquidity ratios

    Calculate the firm's liquidity ratios for each year. Compare the resulting time series of each measure of liquidity (i.e. net working capital, current ratio, and quick ratio). b. Comment on the firm's liquidity over the period. c.

  • Finance

    125009 Finance Indicate for each of the following items whether it would appear on a balance sheet (BS) or an income statement (IS). If a balance sheet item, is it an asset (A), a liability (L), or an owners' equity item (OE)?

  • Profitability, Liquidity and Solvency ratios

    It is among the most popular ratios that are normally computed. The ROE measures the returns, which the company made, and the way it is paid to the equity stock holders.

  • Ratio Analysis - Discussion

    As a result, analyzing an organization's liquidity and its credit risk is very important when conducting a financial analysis. 4. What is the CAPM? Are CAPM assumptions realistic? Why or why not?

  • What is the purpose of financial statement analysis?

    It indicates the ability to pay the short term obligations of the organization. It is computed by Current Assets/Current Liabilities. The other prominent liquidity ratio is quick ratio which measures the near term liquidity of the organization.

  • Financial Analysis of Apple Computers

    Observation: If the Apple were to initiate cost-cutting measures such as to hold lower levels of inventory and substantially decrease the cost of goods sold, the financial benefits of such an effort would filter down to the company's bottom

  • Contribution margin and WACC

    Which of the following ratios measures an organization's liquidity? a. Acid Test b. Debt Ratio c. Return on Equity d. Times Interest Earned e. Return on Assets 7. Trade Credit is a: a. Permanent source of financing b.

View More Related Solutions