Finance
INSTRUCTIONS: | 1. Answer all questions. 2. Answer in ENGLISH. 3. Arithmetic calculators are allowed. (Cellular phones may not be used as calculators). 4. Only answers written in the answer booklet will be marked. 5. Dictionaries are not permitted.
Question 1
Listed below are multiple choice questions. Read the statements and select the most appropriate
Answer. Write the numbers 1.1 to 1.10 and then only the alphabet of your choice. Eg 1.11 C
1.1. _________ analysis involves the comparison of different firms’ financial ratios at the same point in time.
(a) Timeseries
(b) Crosssectional
(c) Marginal
(d) Quantitative
1.2. _________ analysis involves comparison of current to past performance and the evaluation of developing trends.
(a) Timeseries
(b) Crosssectional
(c) Marginal
(d) Quantitative
1.3. Present and prospective shareholders are mainly concerned with a firm’s
(a) risk and return.
(b) profitability.
(c) leverage.
(d) liquidity.
1.4. The _________ is useful in evaluating credit and collection policies.
(a) average payment period
(b) current ratio
(c) average collection period
(d) current asset turnover
1.5. ABC Corp. extends credit terms of 45 days to its customers. Its credit collection would be considered poor if its average collection period was
(a) 30 days.
(b) 36 days.
(c) 47 days.
(d) 57 days.
1.6. The statement of cash flows includes all of the following categories EXCEPT
(a) operating flows.
(b) investment flows.
(c) financing flows.
(d) equity flows.
1.7. Cash flows directly related to production and sale of the firm’s products and services are called
(a) operating flows.
(b) investment flows.
(c) financing flows.
(d) None of the above.
1.8. Cash flows associated with the purchase and sale of fixed assets and business interests are called
(a) operating flows.
(b) investment flows.
(c) financing flows.
(d) None of the above.
1.9. Johnson, Inc. has just ended the
Question 1
Listed below are multiple choice questions. Read the statements and select the most appropriate
Answer. Write the numbers 1.1 to 1.10 and then only the alphabet of your choice. Eg 1.11 C
1.1. _________ analysis involves the comparison of different firms’ financial ratios at the same point in time.
(a) Timeseries
(b) Crosssectional
(c) Marginal
(d) Quantitative
1.2. _________ analysis involves comparison of current to past performance and the evaluation of developing trends.
(a) Timeseries
(b) Crosssectional
(c) Marginal
(d) Quantitative
1.3. Present and prospective shareholders are mainly concerned with a firm’s
(a) risk and return.
(b) profitability.
(c) leverage.
(d) liquidity.
1.4. The _________ is useful in evaluating credit and collection policies.
(a) average payment period
(b) current ratio
(c) average collection period
(d) current asset turnover
1.5. ABC Corp. extends credit terms of 45 days to its customers. Its credit collection would be considered poor if its average collection period was
(a) 30 days.
(b) 36 days.
(c) 47 days.
(d) 57 days.
1.6. The statement of cash flows includes all of the following categories EXCEPT
(a) operating flows.
(b) investment flows.
(c) financing flows.
(d) equity flows.
1.7. Cash flows directly related to production and sale of the firm’s products and services are called
(a) operating flows.
(b) investment flows.
(c) financing flows.
(d) None of the above.
1.8. Cash flows associated with the purchase and sale of fixed assets and business interests are called
(a) operating flows.
(b) investment flows.
(c) financing flows.
(d) None of the above.
1.9. Johnson, Inc. has just ended the