Wgu c214 stuvia - Study guides, Class notes & Summaries

What standards are used to help US investors understand and compare foreign financial statements to domestic financial statements? - ANSWER-International Financial Reporting Standards When a company is optimizing its resources and maintaining or improving productivity, they are engaging in what hypothesis - ANSWER-Efficient Market Hypothesis What is the basic type of negotiable debt? - ANSWER-Bonds What is the characteristic of a stock sold in the secondary markets? - ANSWER-Stocks sold...

Characteristics of preferred stock includes - ANSWER--dividends in arrears -dividends are cumulative -higher payoff claim in a BK (has first dibs in a BK) -considered "hybrid" (part stock/part bond) -no fixed maturity date -no voting rights -can skip dividend payments -dividends don't change year-after-year -used in start ups (IPO) Preferred stock dividends - ANSWER-can go without payment and pay in arrears the following year Characteristics of common stock are - ANSWER--voting ...

Corporate Finance - Answer focuses on financial decision making by a firms management Investments - Answer various types of financial instruments (stocks, bonds, etc) Banking or Financial Institutions - Answer make money by paying depositors a smaller interest rate than the interest rate charged to borrowers Treasury Securities - Answer generally bonds that are issued by the US government Corporate Bonds - Answer firms borrowing from the public Stocks - Answer a share of ownership...

1. The goal of the corporation is to: a. Maximize profits b. Maximize market share c. Maximize stock price d. Minimize risk - Answer c. Maximize stock price 2. Risk premium is best described as a. Return on risky securities b. Compensation for risk-taking c. Return on stocks d. Expected return on securities - Answer b. Compensation for risk-taking 3. What is the relationship between risk and required return? a. The two are independent b. Higher required return causes lower risk ...

Statement of Cash Flows - ANSWER-Shows the change in cash balance for a period of time. Focuses only on items where cash is received, or cash is paid. Cash Flow from Operating Activities (CFO) - ANSWER-Cash flow that a company generates as a result of day-to-day business operations. Deals with Current Assets and Current Liabilities. Cash Flow from Investing Activities (CFI) - ANSWER-Cash flow that is generated from investments in long term assets. Cash Flow from Financing Activities (CF...

Initial Outlay - ANSWER-The total dollar amount to begin a project. Cost of Equity - ANSWER-How much it costs a firm (in percentage terms) to use equity financing. From the investor's perspective, it is what they require given the riskiness/opportunity cost of the company. From the companies perspective, it is the same rate, but it is what it "costs" to attract those potential investors. It is the return they must give investors for them to invest with their company. American Depository...

Statement of Cash Flows - ANSWER-Shows the change in cash balance for a period of time. Focuses only on items where cash is received, or cash is paid. Cash Flow from Operating Activities (CFO) - ANSWER-Cash flow that a company generates as a result of day-to-day business operations. Deals with Current Assets and Current Liabilities. Cash Flow from Investing Activities (CFI) - ANSWER-Cash flow that is generated from investments in long term assets. Cash Flow from Financing Activities (CF...

How can a private firm appropriately maximize shareholder value? - ANSWERSBy making decisions that keep the control of the business with the owners Why are American regulators focused on international investing in a global marketplace? - ANSWERSBecause international investing in a global marketplace is the concern of American investors What is one of the two basic types of financial instruments? - ANSWERSBonds and Stocks If a company outsources the manufacturing of its products to a fo...

Trading on the NYSE is executed without a specialist (i.e. a market maker). (T/F) - Answer F Stocks and bonds are two types of financial instruments (T/F) - Answer True The matching principle in accrual accounting requires that: a. Revenues be recognized when the earnings process is complete and matches expenses to revenues recognized. b. Expenses are matched to the year in which they are incurred c. Revenues are matched to the year in which they are booked d. Revenues should be large...

Trading on the NYSE is executed without a specialist (i.e. a market maker). (T/F) - AnswerF Stocks and bonds are two types of financial instruments (T/F) - AnswerT The matching principle in accrual accounting requires that: a. Revenues be recognized when the earnings process is complete and matches expenses to revenues recognized. b. Expenses are matched to the year in which they are incurred c. Revenues are matched to the year in which they are booked d. Revenues should be large enou...