D. Customer equity benefits customers but not the company. (Points: 3) A firm that employs financial leverage will have a higher equity multiplier than an otherwise identical firm that has no debt in its capital structure. Trust receipt B. B. c. Assets are divided into equity and semi-equity … The firm's current accounts remained constant. Which of the following statements regarding command economies is FALSE? B) The current ratio is used to evaluate a company's ability to pay current obligations. E. statement of operating position. A. The Kimberly Corporation is a zero growth firm with an expected EBIT of $100,000 and a corporate tax rate of 30 percent. Amount invested in cash depends on the size of the cash flow requirement - TRUE C. Investment in cash increases when there is a bull run in the stock market - FALSE D. Investment in cash decreases when interest rates rise- FALSE 3. Which of the following statements about the organization of the balance sheet is(are) most correct? Types of equity financing. revenues are found in the income statement ... False Correct. All of the following are elements of a Balance Sheet except. B) The higher the debt to equity ratio, the greater the company's financial risk. You may have some cash you want to put into the business yourself, so that will be your initial base. a. Capital is more easily accumulated than with most other forms of organizations. Character loan C. Line of credit D. Installment loan If the parts of a firm’s marketing program work well together, it should increase the firm’s customer equity. A private investor could be an employee, local business owner, or supplier. B) reduce the current market value of the firm. D. cash flow statement. Which of the following statements is FALSE about the current ratio? E. None of the above. B)To understand how call provisions affect the price of a bond, we first need to consider when an issuer will exercise its right to call the bond. D) If the debt to equity ratio is less than 1, the company is financing more assets with debt than with equity. For multiple-choice and true/false questions, simply press or click on what you think is the correct answer. True 5. Ridgefield Enterprises has total assets of $300 million. Choose one answer. A. A) Instead of using the dollar amounts, the current ratio makes it easier to compare several companies. A. or You can exceed the speed limit to make the pass quick. False 6. b. Equity sensitives do not react to inequity as equity theory describes b. If the financing of the project involves an equity issue, and if management believes that the equity will sell at a price that is less than its true value, this mispricing is a cost of the project for the existing shareholders. e. Statements b and c are correct. Which of the following statements concerning capital structure theory is false? Kimberly uses $500,000 of 12.0 percent debt financing, and the cost of equity to an … Which of the following statements is CORRECT? ... Stock are a form of equity ownership, not debt financing. 242. Private investors. Expected losses depend on customer equity. It has high yield potential -FALSE B. Owners have unlimited liability for corporate debts. Maybe you also have family or friends who are interested in your business idea and they would like to invest in your business. Bond financing is better than stock financing for investors because income from bonds is taxed on a more favorable basis than income from stock. A. a. freedom b. efficiency c. equity d. innovation Question 2. It does not present changes in owners equity.It has only one element which has the effect on owner's equity. 1. net income or net loss for a specifi c period of time. B. 38. Firm U is unleveraged, i.e., it is 100% equity financed, while Firm L is financed with 50% debt and 50% equity. Statement of Cash Flows: Reports on all of the company’s activities that affect its cash position over a period of time . Which of the following is not a blockage (individual or organizational) to the effort — performance expectancy? A. D. Customer equity benefits customers but not the company. Owners are not agents of the corporation. The following are common types of equity financing to consider for your small business. Question 2 - Cash Flows: Concepts. 1 A Grzeszczak 2016. Which of the following statements is True (T) or False (i) The financing decision affects the total operating profits of the firm. The federal government sells bonds and securities to obtain financing. Driving test question about: Which of the following statements about passing a vehicle is NOT true? Stockholders' equity accounts are increased with credits. (iii) There is no difference of opinion on the relationship between capital structure and value of the firm. High conflict levels b. The following information applies to the next problem. Which of the following statements is true about CASH? A private investor is anyone who invests in your business and is not affiliated with a bank. 1. A)When bond yields have increased, by exercising the call on the callable bond and then immediately refinancing, the issuer can lower its borrowing costs. revenues Correct. (ii) The equity Shareholders get the residual profit of the firm. Given this information, which one of the following statements must be true? Most companies have the resident expertise to complete an initial public offering (IPO) or first public equity issue. Which of the following statements is false? Which of the following statements about customer equity is FALSE? D. Which of thefollowing statements regarding the cost of equity is most correct? True True or False: All publicly traded U.S. companies must provide their shareholders with an annual report each year. If you have difficulty answering the following questions, learn more about this topic by reading our Financial Statements … Task difficulty c. Self-actualization d. Training. equity Incorrect. E. C. Expected profits depend on customer equity. and possible answers include: Avoid passing on the right unless you can do it safely. The government owns the factors of production. C. shareholders' equity statement. Which of the following statements about stockholders' equity is false? For example, the owner of Company ABC might need to raise capital to fund business expansion. For fill-in-the-blank questions press or click on the blank space provided. A. Answer true or false to the following statements. B. On this page you can read or download which of the following statements about equity financing is false everfi investing basics in PDF format. the costs of both debt and equity financing. C) Having more current assets than current liabilities will yield a current ratio less than 1. Stockholders' equity accounts are increased with credits. a) Thecost of debt is the interest rate set on debt financing, while the cost ofequity is defined similarly; it is the rate of return required by equityinvestors. b) Thedebt cost plus risk premium method is one way to estimate the cost of equity. C) reduce the interest rate on debt. Which of the following statements is FALSE? C. It is the cash that equity investors can take out of the firm after financing investment needed to sustain future growth. 1. Question 3 (4 points) Ptarmigan Travelers had sales of $480,000 in 2010 and $420,000 in 2011. That may sound good on the surface to you, but even if this is the best arrangement for you, there are factors you must consider before you jump in. D. It is the cash left over after meeting debt payments and paying taxes. Which of the following statements is false? (Hint: Work Problem 4-16 before answering 4-17, and consider the solution setup for 4-16 as you think about 4-17.) Ownership rights cannot be easily transferred. Which of the following is not a form of cash flow financing? or Do not follow another vehicle that is passing a car in front of you. [3.2] The objective of financial statements is to provide information about an entity's assets, liabilities, equity, income and expenses that is useful to financial statements users in assessing the prospects for future net cash inflows to the entity and in assessing management's stewardship of the entity's resources. Stockholders' equity is the shareholders' residual interest in the company resulting from the difference in assets and liabilities. a. Assets are divided into current and long-term categories. Which of the following economic goals is a major one of command economies? Central planners decide what is produced. False 3. E. If you don't see any interesting for you, use our search form on bottom ↓ . A. It is a separate legal entity. Network standards regarding acceptable advertising have remained constant over the past 30 to 40 years. B. or Do not pass more than one vehicle at a time. The company's basic earning power is 15 percent. All of the following are current assets except. 38. Expected losses depend on customer equity. Choose one answer. d. Statements a and c are correct. False 7. Firms U and L each have the same amount of assets, and both have a basic earning power ratio of 20%. Finance Fundamentals of Financial Management, Concise Edition (MindTap Course List) CONCEPTUAL: RETURN ON EQUITY Which of the following statements is most correct? b. B. 10. D. The higher the debt to equity ratio, the lower the company's financial risk. B. Marks: 1. D. Equity financing involves selling a portion of a company's equity in return for capital. True or False: Examples of notes are descriptions of the significant accounting policies and methods used in preparing the statements, explanations of contingencies, and various statistics. The balance sheet has upper and lower (or left and right) sections. It has a limited life. 11. A. A company is said to go "public" when it opens up its ownership structure to the general public through the sale of common stock. 6. C) If the debt to equity ratio is greater than 1, the company is financing more assets with equity than with debt. a. A. C. Stockholders' equity results only from contributions of the owners. A. Explain the potential reasons this may be true or false Which of the following statements is true? If the debt to equity ratio is greater than 1, the company is financing more assets with equity than with debt. If the parts of a firm’s marketing program work well together, it should increase the firm’s customer equity. Which of the following statements about customer equity is FALSE? B. A. The purpose of this statement is to demonstrate a business’s financial heath at any given time, by enumerating it assets as well as the claims against them (liabilities and equity). A. Which of the following statements is CORRECT? Both firms have positive net income. Which of the following statements about self - regulation by media is true? a. Equity Financing . 27. accounts receivable ... 2. Which of the Following Statements about Customer Equity is FALSE? 242. True 4. Which of the following statements about stockholders' equity is false? The company currently has no debt in its capital structure. Firm L’s debt has a before-tax cost of 8%. True 2. The possibility of bankruptcy will do all of the following except: A) increase financial distress costs. 2. the same gets presented in the Statement of owner's equity. 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