Identify the choice that best completes the statement or answers the question.
_ 1. Pearson Plastics has two equal-sized divisions, Division A and Division B. The company estimates that if the
divisions operated as ind
Chapter 9 Finance Review questions
3. Your local travel agent is advertising an upscale winter vacation package for travel three years
from now to Antarctica. The package requires that you pay $25,000 today, $30,000 one year
from today, and a final paymen
1. Billings, Inc. has net income of $161,000, a profit margin of 7.6 percent, and an accounts receivable balance
of $127,100. Assume that 66 percent of sales are on credit. What is the days' sales in receivables? There are
365 days in a year
9. The aftertax cost of debt:
A. varies inversely to changes in market interest rates.
B. has a greater effect on a firm's cost of capital when the debt-equity ratio increases.
C. will generally exceed the cost of equity if the relevant tax rate is zero.