Fin Midterm 1

Fin Midterm 1 - FIN3716- Fall 2010 MIDTERM 1 SOLUTION Name...

Info iconThis preview shows pages 1–3. Sign up to view the full content.

View Full Document Right Arrow Icon
FIN3716- Fall 2010 MIDTERM 1 SOLUTION Name ________________________________________________ Section____________ Time: 75 Min Total Point: 70 Work on this exam is to be yours alone. Any discussion of either the questions or your answers with anyone other than your instructor will be considered as cheating and, thus, as a violation of the LSU honor code. For Multiple Choice questions, circle the letter/s of the correct multiple-choice answer. You have to show your work to receive partial credit ( if applicable and when possible ) for the answer. Your answers must be COMPREHENSIBLE and your work “ CLEAN ”. Multiple Choice Questions (Each question 4 points) 1. Which of the following are advantages of the corporate form of business ownership? I. limited liability for firm debt II. double taxation III. ability to raise capital IV. unlimited life A. I and II only B. III and IV only C. I, III, and IV only D. II, III, and IV only E. I, II, III, and IV 2. Which one of the following best states the primary goal of financial management? A. maximize current dividends per share B. maximize the current value per share C. increase cash flow and avoid financial distress D. minimize operational costs while maximizing firm efficiency E. maintain steady growth while increasing current profits 3. Which of the following represent cash outflows from a corporation? I. issuance of common shares II. payment of dividends III. new loan proceeds IV. payment of government taxes A. I and III only B. II and IV only C. I and IV only D. I, II, and IV only E. II, III, and IV only
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
4. Sally and Alicia currently are general partners in a business located in Atlanta, Georgia. They are content with their current tax situation but are both very uncomfortable with the unlimited liability to which they are each subjected. Which form of business entity should they consider to replace their general partnership assuming they wish to remain the only two owners of their business? Whichever organization they select, they wish to be treated equally. A. sole proprietorship
Background image of page 2
Image of page 3
This is the end of the preview. Sign up to access the rest of the document.

This note was uploaded on 05/10/2011 for the course FIN 3716 taught by Professor Fang during the Spring '10 term at LSU.

Page1 / 6

Fin Midterm 1 - FIN3716- Fall 2010 MIDTERM 1 SOLUTION Name...

This preview shows document pages 1 - 3. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online