1. Common-size balance sheets express each account value as a percentage of which one of the
A.
B.
C.
D.
2.
following?
total assets
total equity
total sales
net income
Travis United has net income of $12,880 for 2010. On the firm's common-size income stat

FINANCE 300 QUIZ With the information given below, construct Boodroo Inc.'s Balance Sheet, Income Statement and Retained Earnings Statement for 2008. December 31, 2008 Cash Notes Payable Sales Accounts Receivable Accounts Payable Long-term Debt Common Sto

1 TEST II PREP FINANCE 300 Dr. Boudreaux I. MC questions from 1st exam. II. Identify/Define 1. Systematic Risk 2. Unsystematic Risk 3. Beta 4. CAPM 5. SML 6. Risk Averse 7. Annuity 8. Annuity Due 9. Bond 10. Preferred Stock 11. Common Stock 12. Gordon Mod

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Chapter 4
Cash Flow and Financial Planning
Learning Goals
o
o
LG2 Discuss the firms statement of cash flows, operating cash flow, and free
cash flow.
o
LG3 Understand the financial planning process, including long-term (strategic)
financial plans and shor

Chapter 5
Time Value of Money
Learning Goals
o
o
LG2 Understand the concepts of future value and present value, their
calculation for single amounts, and the relationship between them.
o
LG1 Discuss the role of time value in finance, the use of computatio

Chapter 2
The Financial Market Environment
Learning Goals
LG2 Contrast the functions of financial institutions and financial markets.
LG3 Describe the differences between the capital markets and the money markets.
LG4 Explain the root causes and subsequen

Chapeter 3
Financial Statements and Ratio Analysis
Learning Goals
o
o
LG2 Understand who uses financial ratios and how.
o
LG3 Use ratios to analyze a firms liquidity and activity.
o
LG4 Discuss the relationship between debt and financial leverage and the

FNAN 300
Chapter 1
What is Finance?
Finance can be defined as the science and art of managing money.
At the personal level, finance is concerned with individuals decisions about:
how much they save
how much of their earnings they spend
how they invest the

I. Identify/Define
1. Systematic Risk: cannot be eliminated (called market risk)
factors that systematically impact all firms such as:
wars
inflation
recession
high interest rates
confidence
2. Unsystematic Risk: can be reduced by diversification
Fac

1
FINANCE 300
FALL 2016
DR. BOUDREAUX
HANDOUT XIV
EXAM PREP
I WILL NOT POST ANY ANSWERS.
I. PROBLEMS/CASES/ESSAY
1 What are the two requirements for a firm to be successful discussed in the 5 minute
lesson for success?
- Have highly valued services and pr

FINANCE 300
Dr. Denis Boudreaux
FALL 2016
TEST III PREPARATION
Define
1. Sensitivity Analysis: investigation of what happens to the net present value when only
one variable is changed
2. Scenario Analysis: the determination of what happens to the net pres

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FNAN 300 Test #4 Study Guide
1. Real rate of interest (as component of nominal rate): Pg. 222-223
1. Definition the rate that creates equilibrium between the supply of savings and the
demand for investment funds in a perfect world, without inflation, wher

Using a financial calculator
How to calculate Future Values with a Fin. Calculator?
A typical fin. Calculator has five keys of particular interest.
N
I
PMT
PV
FV
N refers to the number of periods
I stands for the interest rate
Future value of $100 at 10%

Ch. 5 Discounted Cash Flow Valuation
1. How much will you have saved at the end of 3 years if you save $4,100 at the end of each year
for three years, compounded annually at 15 percent interest?
A. $14,974.35
B. $13,926.16
C. $13,560.58
D. $14,237.25
FV =

Ch. 4 Introduction to Valuation: The Time Value of Money
1. Currently, you are earning an annual salary of $42,700. How much will your salary be 6 years
from now if you receive annual raises of 4.1 percent?
A. $52,551.53
B. $51,499.42
C. $54,341.58
D. $55

Finance Test 2 Study Guide
1. Federal regulatory body governing the sale and listing of securities (pg. 58):
a. Securities and Exchange Commission (SEC)
2. The stockholder's annual report must include (pg. 59):
a. Stockholders report Annual report that pu

FNAN 300 Test #3 Study Guide
*Refer to the page numbers of all examples given to see the entire question*
1. Time Value of Money (pg. 161):
a. Definition refers to the observation that it is better to receive money sooner than later.
b. A dollar today is

FNAN 300 Test #7 Study Guide
1. Purpose of managing current assets and current liabilities: Pg. 600
a. To achieve a balance between profitability and risk that contributes positively to the
firms value.
b. A.K.A. working capital (or short-term financial)

FNAN 300 Test 1 Study Guide
1. Definition of Finance:
a. Finance can be defined as the science and art of managing money
b. At the personal level, finance is concerned with individuals decisions about how much
of their earnings they spend, how much they s

FNAN 300 Test 1 Study Guide
1. Definition of Finance:
a. Finance can be defined as the science and art of managing money
b. At the personal level, finance is concerned with individuals decisions about how much
of their earnings they spend, how much they s

FNAN 300 - Test #5 Study Guide
1. Independent and mutually exclusive projects: Pg. 391
a. Independent projects Projects whose cash flows are unrelated to (or independent of)
one another; the acceptance of one does not eliminate the others from considerati

FNAN 300 Test #6 Study Guide
1. Relationship between leverage and risk: Pg. 508
a. Leverage magnifies both return and risks. A firm with more leverage may earn higher
revenues on average than a firm with less leverage, but the returns on the more
leverage

Chapter 8
IRR APP FIN CALC irr(cashflow0,cfw_cashflow1, cashflow2)
NPV npv(RateOfRet, yeartofind, cfw_payment1, difpayment, difpayment, cfw_howmanypaymt1, ) year0
Rombelski has identified the following two mutually exclusive projects:
YEAR
A
B
0
-67000
-6

1.
The systematic risk principle argues that the market does not reward risks that are
diversifiable and that are borne unnecessarily.
2. The standard deviation is the square root of the variance.
3. The computation of variance requires 4 steps. Place the

1. The square of the standard deviation is equal to the variance.
2. The second lesson from studying capital market history states that the greater the potential
reward, the greater the risk and vice versa.
3. Arrange the following investments from lowest

1.
Which of the following can be determined using the future value approach to compound
growth developed in this chapter?
a. Dividend Growth
b. Population Growth
c. Sales Growth
d. Erratic Growth
2. The concept of the time value of money is based on the p

1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
11.
12.
13.
14.
15.
16.
17.
A project should be accepted if its NPV is greater than zero.
In general, NPV is: Equal to zero when the discount rate equals the IRR, negative for discount rates above the IRR, and positive for d