a straight-line basis over five years to zero. Rocky Mountain’s tax rate is 34 percent, and its opportunity cost of capital is 10 percent. What is the NPV of the new wood saw? Selected Answer: 38,356 Correct Answer: 38,356 Answer range +/- 1 (38355.0 - 38357.0) Thursday, May 7, 2015 8:42:56 PM MST EXAM 1 Cusic Industries had the following operating results for 2010: sales = $15,300; cost of goods sold = $10,900; depreciation expense = $2,100; interest expense = $520; dividends paid = $500. At the beginning of the year, net fixed assets were $11,800, current assets were $3,400, and current liabilities were $1,900. At the end of the year, net fixed assets were $12,900, current assets were $3,950, and current liabilities were $1,950. The tax rate for 2010 was 40 percent. What is the CFOA (cash flows available to investors from operarting activities for 2010? Selected Answer: [None Given] Correct Answer: 3,688 Answer range +/- 0.5 (3687.5 - 3688.5) Question 2
3 out of 3 points On the income statement, Net income = Revenues - _____________. Selected Answer: Expens es Correct Answer: Evaluation Method Correct Answer Case Sensitivity Exact Match expenses Exact Match expense Question 3 3 out of 3 points What are some major factors that affect a firm’s stock price? Selected Answer: the firm's expected future cash flows and their riskiness Answers: the time preferences for bondholders wanting to hold cash the time preferences for shareholders wanting to hold cash overall market conditions and the number of bondholders the firm's expected future cash flows and their riskiness Question 4 3 out of 3 points Financial statements can be analyzed from the following three different perspectives: Selected Answer: manager, shareholder, creditor Answers: lawyer, accountant, manager manager, shareholder, creditor goverment, lawyer, regulator student, faculty, dean Question 5
0 out of 3 points Which of the following is an appropriate goal for the firm? Selected Answer: profit maximization Answers: profit maximization sales maximzation shareholder wealth maximization tax minimization Question 6 3 out of 3 points The idea that all public (but not private) information about a security is reflected in its price is known as the ___________ form of the efficient market hypothesis. Selected Answer: Semistro ng Correct Answer: Evaluation Method Correct Answer Case Sensitivity Exact Match semistrong Exact Match semi-strong Exact Match semi strong Question 7 4 out of 4 points Perez Electronics Corp. has reported that its net income for 2006 is $1,276,351. The firm has 420,000 shares outstanding and a P-E ratio of 11.2 times. What is the firm's share price (per share)? Selected Answer: 34.05 Correct Answer: 34.05 Answer range +/- 0.05 (34.00 - 34.10) Question 8 3 out of 3 points One of the main services offered by investment banks to companies is Selected Answer: helping companies sell new debt or equity issues in the security markets.
Answers: helping companies sell new debt or equity issues in the security markets. making loans to companies.
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