Finance 320 Final Exam
SampleFinal
Finance 320
Finance Department
Name___________________________________
Chapters: 1, 2, 3, 4, 5, 6, 7, 8, 9, 11, 12, and 13
1) A C corporation earns $4.50 per share before taxes. The corporate tax rate is 35%, the personal tax rate on dividends is 20%, and the personal tax rate on non-dividend income is 39%. What is the total amount of taxes paid if the company pays a $2.00 dividend?
A) $2.48
B) $1.98
C) $0.90
D) $1.58
2) Why in general do financial managers make financial decisions in a corporation, rather than the owners making these decisions themselves?
A) The interests of the various owners may conflict with each other.
B) It is best for the control of the finances of a corporation to be in the hands of a disinterested third party.
C) The owners may not be U.S. citizens or residents.
D) There are often many owners, and they can often change as they buy and sell stock.
3) Which of the following is NOT a function of the board of directors?
A) answering to shareholders of the company
B) monitoring the performance of the company
C) determining how top executives should be compensated
D) day-to-day running of the company
4) Which of the following is a measure of the aggregate price level of collections of pre-selected stocks?
A) Euronext
B) NYSE
C) S&P 500
D) NASDAQ
5) Which of the following is not a role of financial institutions?
A) Printing money for borrowers.
B) Moving funds from savers to borrowers.
C) Spreading out risk-bearing.
D) Moving funds though time.
6) In the United States, publicly traded companies can choose whether or not they wish to release periodic financial statements.
A) True
B) False
7) A company that produces drugs is preparing a balance sheet. Which of the following would be most likely to be considered a long-term asset on this balance sheet?
A) a patent for a drug held by the company
B) the cash reserves of the company
C) commercial paper held by the company
D) the inventory of
Finance 320
Finance Department
Name___________________________________
Chapters: 1, 2, 3, 4, 5, 6, 7, 8, 9, 11, 12, and 13
1) A C corporation earns $4.50 per share before taxes. The corporate tax rate is 35%, the personal tax rate on dividends is 20%, and the personal tax rate on non-dividend income is 39%. What is the total amount of taxes paid if the company pays a $2.00 dividend?
A) $2.48
B) $1.98
C) $0.90
D) $1.58
2) Why in general do financial managers make financial decisions in a corporation, rather than the owners making these decisions themselves?
A) The interests of the various owners may conflict with each other.
B) It is best for the control of the finances of a corporation to be in the hands of a disinterested third party.
C) The owners may not be U.S. citizens or residents.
D) There are often many owners, and they can often change as they buy and sell stock.
3) Which of the following is NOT a function of the board of directors?
A) answering to shareholders of the company
B) monitoring the performance of the company
C) determining how top executives should be compensated
D) day-to-day running of the company
4) Which of the following is a measure of the aggregate price level of collections of pre-selected stocks?
A) Euronext
B) NYSE
C) S&P 500
D) NASDAQ
5) Which of the following is not a role of financial institutions?
A) Printing money for borrowers.
B) Moving funds from savers to borrowers.
C) Spreading out risk-bearing.
D) Moving funds though time.
6) In the United States, publicly traded companies can choose whether or not they wish to release periodic financial statements.
A) True
B) False
7) A company that produces drugs is preparing a balance sheet. Which of the following would be most likely to be considered a long-term asset on this balance sheet?
A) a patent for a drug held by the company
B) the cash reserves of the company
C) commercial paper held by the company
D) the inventory of