Reviewing Financial Statements
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- Introduction to Financial ManagementReviewing Financial StatementsAnalyzing Financial StatementsTime Value of Money 1: Analyzing Single Cash FlowsTime Value of Money 2: Analyzing Annuity Cash FlowsUnderstanding Financial Markets and InstitutionsValuing BondsValuing StocksCharacterizing Risk and ReturnEstimating Risk and ReturnCalculating the Cost of CapitalEstimating Cash Flows on Capital Budgeting ProjectsWeighing Net Present Value and Other Capital Budgeting CriteriaWorking Capital Management and PoliciesFinancial Planning and ForecastingAssessing Long-Term Debt, Equity, and Capital StructureSharing Firm Wealth: Dividends, Share Repurchases, and Other PayoutsIssuing Capital and the Investment Banking ProcessInternational Corporate FinanceMergers and Acquisitions and Financial Distress
Question 1
Free
Multiple Choice
Which financial statement reports a firm's assets, liabilities, and equity at a particular point in time?
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balance sheet
income statement
statement of retained earnings
statement of cash flows
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Question 2
Free
Multiple Choice
Which financial statement shows the total revenues that a firm earns and the total expenses the firm incurs to generate those revenues over a specific period of time-generally one year?
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balance sheet
income statement
statement of retained earnings
statement of cash flows
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Question 3
Free
Multiple Choice
Which financial statement reports the amounts of cash that the firm generated and distributed during a particular time period?
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balance sheet
income statement
statement of retained earnings
statement of cash flows
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Question 4
Free
Multiple Choice
Which financial statement reconciles net income earned during a given period and any cash dividends paid within that period using the change in retained earnings between the beginning and end of the period?
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balance sheet
income statement
statement of retained earnings
statement of cash flows
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Question 5
Free
Multiple Choice
On which of the four major financial statements would you find the common stock and paid-in surplus?
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balance sheet
income statement
statement of cash flows
statement of retained earnings
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Question 6
Multiple Choice
On which of the four major financial statements would you find the increase in inventory?
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balance sheet
income statement
statement of cash flows
statement of retained earnings
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Question 7
Multiple Choice
On which of the four major financial statements would you find net plant and equipment?
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balance sheet
income statement
statement of cash flows
statement of retained earnings
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Question 8
Multiple Choice
Financial statements of publicly traded firms can be found in a number of places. Which of the following is NOT an option for finding publicly traded firms' financial statements?
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Facebook
a firm's website
Securities and Exchange Commission's (SEC) website
websites such as finance.yahoo.com
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Question 9
Multiple Choice
For which of the following would one expect the book value of the asset to differ widely from its market value?
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cash
accounts receivable
inventory
fixed assets
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Question 10
Multiple Choice
Common stockholders' calculating equity divided by number of shares of common stock outstanding is the formula for
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earnings per share (EPS).
dividends per share (DPS).
book value per share (BVPS).
market value per share (MVPS).
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Question 11
Multiple Choice
When a firm alters its capital structure to include more or less debt (and, in turn, less or more equity), it impacts which of the following?
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the residual cash flows available for stockholders
the number of shares of stock outstanding
the earnings per share (EPS)
all of these choices are correct.
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Question 12
Multiple Choice
This is the amount of additional taxes a firm must pay out for every additional dollar of taxable income it earns.
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average tax rate
marginal tax rate
progressive tax system
earnings before tax
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Question 13
Multiple Choice
An equity-financed firm will
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pay more in income taxes than a debt-financed firm.
pay less in income taxes than a debt-financed firm.
pay the same in income taxes as a debt-finance firm.
not pay any income taxes.
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Question 14
Multiple Choice
Deferred taxes occur when a company postpones taxes on profits pertaining to
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tax years they are under an audit by the Internal Revenue Service.
funds they have not collected because they use the accrual method of accounting.
a loss they intend to carry back or carry forward on their income tax returns.
a particular period as they end up postponing part of their tax liability on this year's profits to future years.
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Question 15
Multiple Choice
Net operating profit after taxes (NOPAT) is defined as which of the following?
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net profit a firm earns before taxes, but after any financing costs
net profit a firm earns after taxes, and after any financing cost
net profit a firm earns after taxes, but before any financing costs
net profit a firm earns before taxes, and before any financing cost
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Question 16
Multiple Choice
This is cash flow available for payments to stockholders and debt holders of a firm after the firm has made investments in assets necessary to sustain the ongoing operations of the firm.
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net income available to common stockholders
cash flow from operations
net cash flow
free cash flow
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Question 17
Multiple Choice
Which of the following activities result in an increase in a firm's cash?
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decrease fixed assets
decrease accounts payable
pay dividends
repurchase of common stock
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Question 18
Multiple Choice
These are cash inflows and outflows associated with buying and selling of fixed or other long-term assets.
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cash flows from operations
cash flows from investing activities
cash flows from financing activities
net change in cash and cash equivalents
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Question 19
Multiple Choice
If a company reports a large amount of net income on its income statement during a year, the firm will have
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positive cash flow.
negative cash flow.
zero cash flow.
all of these choices are correct.
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Question 20
Multiple Choice
Free cash flow is defined as
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cash flows available for payments to stockholders of a firm after the firm has made payments to all others with claims against it.
cash flows available for payments to stockholders and debt holders of a firm after the firm has made payments necessary to vendors.
cash flows available for payments to stockholders and debt holders of a firm after the firm has made investments in assets necessary to sustain the ongoing operations of the firm.
cash flows available for payments to stockholders and debt holders of a firm that would be tax-free to the recipients.
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