Please help me to answer this question.

1. The ratio of ________ to ________ is an indicator of the quality of a firm's earnings.

a. cash flow from operations, net income

b. liabilities, assets

c. dividends, interest expense

d. cash flow from operations, capital expenditures

2. As the number of monthly payments on a loan increases, the size of each payment ________ and the total interest paid over the life of the loan ________.

a. increases, decreases

b. decreases, stays the same

c. stays the same, decreases

d. decreases, increases

3. The matching principle requires that

a. expenses be recognized in the period when cash payments occurred.

b. allows considerable latitude in the timing of expense recognition.

c. expenses be recognized in the same period as when the firm became liable for payment.

d. all expenses be allocated to some specific source of revenue.

4. The revenue recognition principle requires that

a. revenue be recognized only after cash payment has been received.

b. only the amount of revenue for which cash will be received in the current fiscal year be recognized in the current year.

c. allows considerable latitude in the timing of revenue recognition.

d. revenue be recognized in the period when the firm becomes entitled to payment for goods or services delivered.

5. Firms that wish to raise funds for investment purposes issue securities in the

a. primary and secondary markets.

b. primary markets.

c. secondary markets.

d. intermediary markets.

6. What is the reason for computing the acid test ratio in addition to the current ratio?

a. inventory is the most liquid of the liquid assets.

b. a firm's inventory may not be particularly liquid.

c. inventory is the best collateral for short term loans.

d. compared to accounts receivable, inventory balances may be difficult to verify

7. The market for short-term debt is known as

a. the bond market.

b. the notes market.

c. the capital market.

d. the money market.

8. You wish to borrow $2,000 to be repaid in 12 monthly instalments of $170.30. The annual interest rate is

a. 24%.

b. 4%.

c. .04%.

d. 22%.

9. Operating cash flow will increase with a decrease in

a. inventories.

b. current liabilities.

c. depreciation expense.

d. capital expenditures.

10. On a balance sheet, equity equals

a. Total assets minus total liabilities.

b. Current assets plus fixed assets.

c. Fixed assets minus long-term debt.

d. Long term debt plus preferred stock plus common stock plus retained earnings.