CFI CBCA Core Course Assessments & Quizzes with Complete Solutions

CFI CBCA Core Course Assessments & Quizzes with Complete Solutions What is the main goal of using business writing fundamentals? ✔✔To reduce mental effort Which of the following statements describes a "Capacity" strength or weakness for a company in the 5 Cs of credit framework? ✔✔The net profit margin ra tio is high. Which of the following statements describes a "Condition" strength or weakness for a company in the 5 Cs of credit framework? ✔✔The risks associated with the industry are high. Which of the following scenarios would NOT be considered a strength when assessing the management team as part of evaluating a company's character? ✔✔Financial reports are not widely shared and performance measures have not been identified. Which of the f ollowing ratios most likely indicates strong "Capacity" for a company? ✔✔High asset turnover ratio Select the correct formula to calculate the operating margin ratio. ✔✔Operating Margin Ratio = EBIT / Revenue Select the correct formula to calculate the i nventory turnover ratio. ✔✔Inventory Turnover Ratio = Cost of Goods Sold / Average Inventory Which of the following most likely indicates strong "Capital" for a company? ✔✔Unutilized lines of credit or loans Which of the following statements on collatera l is NOT correct? ✔✔Collateral can be used as the main determinant of a credit decision. Which of the following tools or methods is used to assess the general business environment? ✔✔PEST analysis Select the loan contract with the lowest risk. ✔✔A demand loan with monthly payments secured by assets Which is not one of the three main financial statements? ✔✔Statement of equity What does the balance sheet indicate? ✔✔The financial strength of the business Financing activities ✔✔Issuing shares and bonds Operating activities ✔✔Payments to suppliers; Depreciation and amortization expense Investing activities ✔✔Buying and selling equipment Which is not a section in the financial statement note disclosures? ✔✔Management discussion and analysis Balance Sheet ✔✔Retained earnings; Share captial Income Statement ✔✔Rent expense Cash Flow Statement ✔✔Sale of property, plant and equipment If a company has net assets equal to $3.25 million but is sold for $5.35 million, how much goodwill does the acq uirer record on their balance sheet? ✔✔$2.1 million Intangible assets ✔✔Items of value, which have no physical substance, that are used to generate revenues Authorized shares ✔✔The total number of shares a company can sell Contingencies ✔✔Events that ma y or may not happen, depending on certain circumstances Commitments ✔✔Future obligations that a company has agreed to If a company issues 60,000 shares at $0.25 each but the shares have a par value of $0.20 each, what is the resulting contributed surplus ? ✔✔$3,000 What line item is not found in the statement of shareholders' equity? ✔✔Debt issued or repurchased What is not true about a partnership? ✔✔Partners cannot be held liable for a debt