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COB 300 B Quiz, 300 Finance Test 1 Questions and Answers £10.46
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COB 300 B Quiz, 300 Finance Test 1 Questions and Answers
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COB 300 B Quiz, 300 Finance Test 1 Questions and Answers Return on Assets is - the rate of return generated by the firms assets return on common equity is - the return provided to stockholders (in an accounting sense) Return on invested capital (ROIC) is - the return provided to all suppliers o...

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  • January 8, 2025
  • 11
  • 2024/2025
  • Exam (elaborations)
  • Questions & answers

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  • cob 300 b quiz 300 finance test 1 questions and a

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  • COB 300
  • COB 300

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COB 300 B Quiz, 300 Finance Test 1
Questions and Answers

Return on Assets is - ✔✔the rate of return generated by the firms assets


return on common equity is - ✔✔the return provided to stockholders (in an accounting sense)


Return on invested capital (ROIC) is - ✔✔the return provided to all suppliers of capital


Operating cycle - ✔✔The length of time it takes for the investment of cash in inventory to be returned in

the form of payments from customers


The longer the operating cycle - ✔✔the greater the need for liquidity


Current assets generally includes - ✔✔cash, marketable securities, accounts receivable, and inventories


Current liabilities generally includes - ✔✔accounts payable, accrued wages and taxes, and notes payable


Low liquidity ratios are often a sign of - ✔✔financial difficulties


Price earnings ratio (P/E) - ✔✔how much investors are willing to pay for $1 of reported earnings


Market to book ratio (M/B) - ✔✔how much investors are willing to pay for $1 of book value equity


Common size analysis provides - ✔✔a "big picture" of the changing relationships among accounts over

time by standardizing the data


Vertical common size analysis - ✔✔Each account as % of total



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Horizontal common size analysis - ✔✔Each account as % of base year


Window dressing - ✔✔techniques to make statements and ratios look better


Compensation plans can result in - ✔✔Distortions / Dressing


Ratios standardize - ✔✔numbers and facilitate comparisons


Ratios are used to - ✔✔highlight weaknesses and strengths


Ratio comparisons - ✔✔should be made through time and with competitors


Finance is about - ✔✔The allocation of funds between those with more funds than they need and those

who needs funds


The three primary areas of finance - ✔✔Business finance, investments, financial institutions


The financial system provides an environment in which - ✔✔households provide funds to businesses and

government


Market intermediary facilitates - ✔✔the allocation of funds by matching borrowers and lenders


Financial Intermediary - ✔✔Provides funds to institution who in turn provides funds to business or

government


A security is - ✔✔A negotiable financial instrument that is evidence of indebtedness or ownership


Equity interests (Common Stock) - ✔✔which represent the ownership interest that the provider of funds

has in the user of funds


Hybrid securities (convertible bonds or preferred stock) - ✔✔Have characteristics of both equity and debt


Money Market security is a - ✔✔short term security (T-Bills, commercial paper)



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