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kaplan mt482 unit 1 quiz

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Question;Question 1. Question;Which of the following statements regarding the intrinsic;value of a company is correct?;It can be calculated as book value plus the;present value of future expected dividends, discounted at the cost of equity;capital.;It can be calculated as present value of;future expected dividends, discounted at the cost of debt.;It can be calculated as present value of;future expected residual income, discounted at the cost of equity capital.;It can be calculated as book value plus the;present value of future expected residual income, discounted at the cost of;equity capital;Question 2. Question;Which of the following statistics would be the most useful;in determining the efficiency of a car rental company?;Inventory turnover;Number of employees per car rental;Average length of car rental;Number of days cars are rented as a percentage;of number of days available for rent;Question 3. Question;Following is some financial information for Dell Inc.;What is Dell's P/E ratio for 2006?;\;27.63;12.81;23.65;9.70;Question 4. Question;A common size income statement would typically be prepared;by dividing;all items on income statement in Year t by;their corresponding value in Year t-1.;all items on income statement in Year t by;their corresponding balance sheet accounts in Year t.;all items on income statement in Year t by net;income in Year t-1.;all items on income statement in Year t by;sales in Year t.;Question 5. Question;Given the following information, calculate the inventory;turnover for ABC Co. for 2006 (pick closest number).;8.96;7.22;6.93;6.18;Question 6. Question;You have been provided the following information about High;Inc.;Working Capital for 2005 is;$56,000;$20,000;$151,000;$207,000;Question 7. Question;You are analyzing a large stable company. For the year;ending 12/31/05 the company reported earnings of $58,900K and book value at the;end of 2005 was $371,700K. You expect earnings to grow at 5% a year in;perpetuity, and the dividend payout ratio of 70% to continue. The company;borrows at 8%, and has a cost of equity of 12%. The company has 25,000K shares;outstanding.;What is your estimate of price using the residual income;valuation model at 12/31/05?;$20.62;$21.65;$23.56;$24.72 ();s;Question 8. Question;If a company receives an unqualified audit opinion it means;the auditors;did not complete a full audit and therefore do;not feel qualified to give an opinion on financial statements.;are providing assurance that the company will;remain financially viable for at least the next year.;are providing assurance that the company's;financial statements fairly present company's financial performance and;position.;are providing assurance that the company's;financial statements are free from misstatement, fraudulent accounting and;fairly indicate future performance.;Question 9. Question;Which of the following ratios is not generally considered to;be helpful in assessing short-term liquidity?;Acid test ratio;Current ratio;Days to collect receivables;Days goodwill held;Question 10. Question;Two otherwise equal companies have significantly different;dividend payout ratios. Which of the following statements is most likely to be;correct? The company with higher the dividend payout ratio;will have a higher inventory turnover ratio.;will have a lower inventory turnover ratio.;will have higher earnings growth.;will have lower earnings growth.

 

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