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Corporate Finance Test Bank Questions & 100% Correct Answers- Latest Test | Graded A+ | Passed
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Projected future financial statements are called: A. plug statements. B. pro forma statements. C. reconciled statements. D. aggregated statements. E. comparative statements. ֎ -:- B The extended version of the percentage of sales method: A. assumes that all net income will be paid out i...

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  • August 27, 2024
  • 41
  • 2024/2025
  • Exam (elaborations)
  • Questions & answers

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  • corporate finance test bank questions 100 corr

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  • Corporate Finance
  • Corporate Finance

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Excellence is key | 2024/2025 ~Page |1



Corporate Finance Test Bank Questions &
100% Correct Answers- Latest Test |
Graded A+ | Passed
Projected future financial statements are called:




A. plug statements.


B. pro forma statements.


C. reconciled statements.


D. aggregated statements.


E. comparative statements.


֎ -:- B




The extended version of the percentage of sales method:




A. assumes that all net income will be paid out in dividends to stockholders.


B. assumes that all net income will be retained by the firm and offset by a reduction in debt.


C. is based on a capital intensity ratio of 1.0.


D. requires that all financial statement accounts change at the same rate.


E. separates accounts that vary with sales from those that do not vary with sales.




26/08/2024 | © Copyright- This work may not be copied for profit.

, Excellence is key | 2024/2025 ~Page |2


֎ -:- E




Which statement expresses all accounts as a percentage of total assets?




A. pro forma balance sheet


B. common-size income statement


C. statement of cash flows


D. pro forma income statement


E. common-size balance sheet


֎ -:- E




Ratios that measure a firm's ability to pay its bills over the short run without undue stress

are known as:




A. asset management ratios.


B. long-term solvency measures.


C. liquidity measures.


D. profitability ratios.


E. market value ratios.




26/08/2024 | © Copyright- This work may not be copied for profit.

, Excellence is key | 2024/2025 ~Page |3


֎ -:- C




The current ratio is measured as:




A. current assets minus current liabilities.


B. current assets divided by current liabilities.


C. current liabilities minus inventory, divided by current assets.


D. cash on hand divided by current liabilities.


E. current liabilities divided by current assets.


֎ -:- B




The quick ratio is measured as:




A. current assets divided by current liabilities.


B. cash on hand plus current liabilities, divided by current assets.


C. current liabilities divided by current assets, plus inventory.


D. current assets minus inventory, divided by current liabilities.


E. current assets minus inventory minus current liabilities.




26/08/2024 | © Copyright- This work may not be copied for profit.

, Excellence is key | 2024/2025 ~Page |4


֎ -:- D




Ratios that measure a firm's financial leverage are known as ________ ratios.




A. asset management


B. long-term solvency


C. short-term solvency


D. profitability


E. market value


֎ -:- B




The debt-equity ratio is measured as:




A. total equity divided by long-term debt.


B. total equity divided by total debt.


C. total debt divided by total equity.


D. long-term debt divided by total equity.


E. total assets minus total debt, divided by total equity.




26/08/2024 | © Copyright- This work may not be copied for profit.

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