FIN 312 Chapter 16
Management of working capital involves decision about the optimal overall level of current
assets and the optimal mix of short0term and longterm funds used to finance the companys
FIN 312: FALL 2011
FINANCIAL MANAGEMENT II
INSTRUCTOR:
Dr. John M. Harris
Post:
301 Sirrine Hall
Clemson University
Clemson, SC 296341323
EMail: [email protected] (the best way to communicate)
Fax
CHAPTER 13
CURRENT LIABILITIES AND CONTINGENCIES
IFRS questions are available at the end of this chapter.
TRUEFALSEConceptual
Answer
F
F
T
T
T
T
T
F
T
F
T
F
T
F
T
T
F
F
F
T
No.
Description
1.
2.
3.
4
CHAPTER 16
DILUTIVE SECURITIES AND EARNINGS PER SHARE
IFRS questions are available at the end of this chapter.
TRUEFALSEDilutive SecuritiesConceptual
Answer
T
F
T
F
F
T
F
T
F
T
F
F
T
F
T
F
T.
F.
T
F
CHAPTER 20
ACCOUNTING FOR PENSIONS
AND POSTRETIREMENT BENEFITS
IFRS questions are available at the end of this chapter.
TRUEFALSEConceptual
Answer
F
T
F
T
T
F
F
T
F
T
F
F
T
F
T
F
T
F
T
F
No.
Descript
CHAPTER 19
ACCOUNTING FOR INCOME TAXES
IFRS questions are available at the end of this chapter.
MULTIPLE CHOICEConceptual
21.
Taxable income of a corporation
a. differs from accounting income due to d
CHAPTER 15
STOCKHOLDERS EQUITY
IFRS questions are available at the end of this chapter.
MULTIPLE CHOICEConceptual
Answer
c
b
d
b
c
c
d
d
d
b
a
b
a
d
b
a
d
c
No.
21.
22.
23.
S
24.
S
25.
26.
27.
28.
29.
CHAPTER 22
ACCOUNTING CHANGES AND ERROR ANALYSIS
TRUEFALSEConceptual
Answer
F
T
F
T
F
T
T
T
F
T
F
F
T
F
T
T
T
F
T
F
No.
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
11.
12.
13.
14.
15.
16.
17.
18.
19.
*20.
Descrip
CHAPTER 17
INVESTMENTS
IFRS questions are available at the end of this chapter.
TRUEFALSEConceptual
Answer
F
T
F
F
T
F
T
F
T
T
F
T
F
T
F
T
F
T
F
T
No.
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
11.
12.
13.
14.
1
Chapter 14
MULTIPLE CHOICEConceptual
21.
An example of an item which is not a liability is
a. dividends payable in stock.
b. advances from customers on contracts.
c. accrued estimated warranty costs.
CHAPTER 24
FULL DISCLOSURE IN FINANCIAL REPORTING
IFRS questions are available at the end of this chapter.
TRUEFALSEConceptual
Answer
F
T
T
F
F
T
F
T
F
T
F
T
F
T
F
T
F
T
T
F
No.
Description
1.
2.
3.
CHAPTER 23
STATEMENT OF CASH FLOWS
IFRS questions are available at the end of this chapter.
TRUEFALSEConceptual
Answer
F
T
T
F
T
F
T
F
F
T
F
T
F
F
T
F
T
T
F
T
No.
Description
1.
2.
3.
4.
5.
6.
7.
8.
CHAPTER 21
ACCOUNTING FOR LEASES
IFRS questions are available at the end of this chapter.
TRUEFALSEConceptual
Answer
T
F
F
T
F
F
T
F
F
T
F
F
T
F
T
F
T
F
T
T
No.
Description
1.
2.
3.
4.
5.
6.
7.
8.
9.
CHAPTER 13
MULTIPLE CHOICEConceptual
21.
Liabilities are
a. any accounts having credit balances after closing entries are made.
b. deferred credits that are recognized and measured in conformity with
CHAPTER 12
INTANGIBLE ASSETS
IFRS questions are available at the end of this chapter.
TRUEFALSEConceptual
Answer
F
F
T
F
T
F
T
F
T
T
F
T
F
T
T
T
F
F
F
F
F
F
F
T
F
No.
Description
1.
2.
3.
4.
5.
6.
7.
The ExDay Price Drop
DOES DIVIDEND POLICY MATTER?
Dividends matter:
The value of the stock is based on the PV of expected future
dividends.
Dividend policy may not matter:

Dividend policy is the d
FIN 312 Chapter 15 Notes
The fiscal cliff: The Bush budget cuts that were put in place in 2000 are being expired. They
were originally supposed to expire in 2010 but Obama extended them due to the eco
COMPREHENSIVE EXAMINATION F
PART 6
(Chapters 2224)
Problem
FI
FII
FIII
FIV
FV
Topic
Multiple Choice Questions.
Statement of Cash Flows.
Accounting Changes, Error Corrections, and
Prior Period Ad
Weighted Average Cost of Capital, Fratellis
Shares of common stock outstanding
Price per share
Shares of preferred stock outstanding
Price per share
Bonds outstanding
Price per bond
$
12,500,000
27.50
Chapter 15 Quick Notes
The Value of the firm is influenced by three types of financial decisions
1) Investing
2) Financing
3) Dividend
Dividend Policy helps to determine how the earnings of the compan
Leasing: Advantages
Flexibility and Convenience
Leases are easier, quicker, and require less documentation.
Leases are easier to have approved than capital budgeting projects.
Lack of Restrictions

Clientele Effect
Some investors prefer low dividend payouts will buy stock in firms with
low divided payouts
Some investors prefer high dividend payouts buy stock in firms with high
dividend payouts