: Which statement is TRUE about the format of a Balance Sheet?

Select one:

A.

The liabilities are arranged in terms of priority, the liabilities which have high priority (such as long-term debt) are shown first and which have low priority (such as accounts payable and short-term creditors) are shown last.

B.

The assets are arranged in the order of their liquidity, the most liquid asset (such as cash) is shown first and the least liquid asset (such as goodwill) is shown last.

C.

The assets are arranged in the order of permanence i.e., the most permanent asset is shown first, and the least permanent asset is shown last.

D.

The liabilities are arranged in terms of urgency, the liabilities which are urgent (such as accounts payable and long-term debt) are show

Which of the following would be classified as a use of cash?

Select one:

A.

An increase in accounts payable

B.

A decrease in inventories

C.

An increase in retained earnings

D.

An increase in accounts receivable

: Which equation below describes the balance sheet identity?

Select one:

A.

total liabilities = fixed assets + shareholders equity current assets

B.

current assets = current liabilities + shareholders equity fixed assets

C.

net working capital = current assets current liabilities

D.

net working capital = long-term liabilities + shareholders equity fixed assets.

When compiling a pro forma statement, which policy most directly affects the projection of the retained earnings account balance?

Select one:

A.

Capital budgeting policy

B.

Dividend policy

C.

Net working capital policy

D.

Capital structure policy

Which one of the following has the least effect on a firm's sustainable rate of growth?

Select one:

A.

Quick ratio

B.

Dividend policy

C.

Profit margin

D.

Debt-equity ratio

Which of the following questions should be considered when developing a corporations financial plan?

I. How much net working capital will be needed?

II. Will additional fixed assets be required?

III. Will dividends be paid to shareholders?

IV. How much new debt must be obtained?

Select one:

A.

II and III only

B.

II, III, and IV only

C.

I, III, and IV only

D.

I, II, III, and IV

Alli Babu Sdn Bhd has sales of RM1,400,000, cost of goods sold of RM454,200, and a net profit margin of 5.5 percent. The balance sheet shows common stock of RM360,000 with a par value of RM6 a share, retained earnings of RM689,500 and its sales per share is RM23.33. What is the price-sales ratio if the market price is RM50 per share?

Select one:

A.

4.10

B.

0.47

C.

2.14

D.

2.70

Green Holdings has current sales of RM7,000 and a profit margin of 6.5 percent. The firm estimates that sales will increase by 5.5 percent next year and that all costs will vary in direct relationship to sales. What is the pro forma net income?

Select one:

A.

RM438.70

B.

RM705.25

C.

RM250.25

D.

RM405.60

Kapoors debt-equity ratio is 0.85. Its return on assets is 7.5%, return on equity is 13.875% and total equity is RM600,000. What is the equity multiplier?

Select one:

A.

6.375

B.

0.541

C.

1.075

D.

1.850

Which of the following financial statements is concerned with the company at a point in time?

Select one:

A.

Statement of Cashflow

B.

Statement of Retained Earnings

C.

Balance Sheet

D.

Profit and Loss Statement

: A company's external financing needs are met by_____.

Select one:

A.

net working capital and retained earnings.

B.

debt or equity.

C.

retained earnings.

D.

net income and retained earnings.

: Which financial statement explains the changes that took place in the firms cash balance over the year?

Select one:

A.

Income statement

B.

Statement of cash flow

C.

Balance sheet

D.

None of the above