Acc 225 week 9 capstone discussion question

1. STR 581 STR581 Week 4 Capstone Final Examination, Part 2Which of the following
financial statements is concerned with the company at a point in time?income
statementstatement of cash flowsretained earnings statementbalance sheet2A cost
which remains constant per unit at various levels of activity is a:fixed
costmixed costvariable costmanufacturing cost3M&M Proposition 1: Dynamo Corp.
produces annual cash flows of $150 and is expected to exist forever. The company
is currently financed with 75 percent equity and 25 percent debt. Your analysis
tells you that the appropriate discount rates are 10 percent for the cash flows,
and 7 percent for the debt. You currently own 10 percent of the stock. If Dynamo
wishes to change its capital structure from 75 percent equity to 60 percent
equity and use the debt proceeds to pay a special dividend to shareholders, how
much debt should they use? $600$375$225$3214Serox stock was selling for $20 two
years ago. The stock sold for $25 one year ago, and it is currently selling for
$28. Serox pays a $1.10 dividend per year. What was the rate of return for
owning Serox in the most recent year? (Round to the nearest
percent.) 32%16%12%40%5The process of evaluating financial data that change
under alternative courses of action is called:contribution margin analysiscost-benefit
analysisdouble entry analysisincremental analysis6What decision criteria
should managers use in selecting projects when there is not enough capital to
invest in all available positive NPV projects? the discounted paybackthe
profitability indexthe internal rate of returnthe modified internal rate of
return7The convention of consistency refers to consistent use of accounting
principles:among firmswithin industriesthroughout the accounting periodamong
accounting periods8External financing needed: Jockey Company has total assets
worth $4,417,665. At year-end it will have net income of $2,771,342 and pay out
60 percent as dividends. If the firm wants no external financing, what is the
growth rate it can support? 27.3%32.9%25.1%30.3%9Which of the following is
considered a hybrid organizational form?limited liability
partnershippartnershipsole proprietorshipcorporation10An activity that has a
direct cause-effect relationship with the resources consumed is a(n):overhead
rateproduct activitycost drivercost pool11Next year Jenkins Traders will pay a
dividend of $3.00. It expects to increase its dividend by $0.25 in each of the
following three years. If their required rate of return if 14 percent, what is
the present value of their dividends over the next four
years? $11.63$13.50$9.72$12.5012TuleTime Comics is considering a new show that
will generate annual cash flows of $100,000 into the infinite future. If the
initial outlay for such a production is $1,500,000 and the appropriate discount
rate is 6 percent for the cash flows, then what is the profitability index for
the project? 1.900.900.111.1113Your firm has an equity multiplier of 2.47. What
is the debt-to-equity ratio?01.740.601.4714If a company’s weighted average cost
of capital is less than the required return on equity, then the
firm: partnershipis perceived to be safeis financed with more than 50% debthas
debt in its capital structure15When a company assigns the costs of direct
materials, direct labor, and both variable and fixed manufacturing overhead to
products, that company is using:operations costingvariable costingabsorption
costingproduct costing16The major element in budgetary control is:the comparison
of actual results with planned objectives.the valuation of inventoriesthe
preparation of long-term plansthe approval of the budget by the
stockholders17Horizontal analysis is a technique for evaluating a series of
financial statement data over a period of time:to determine which items are in
error.that has been arranged from the highest number to the lowest number.to
determine the amount and/or percentage increase or decrease that has taken
place.that has been arranged from the lowest number to the highest
number.18Which of the following is an advantage of corporations relative to
partnerships and sole proprietorships?lower taxesmost common form of
organizationharder to transfer ownershipreduced legal liability for
investors19The break-even point is where:contribution margin equals total fixed
costs.total variable costs equal total fixed costs.total sales equal total
variable costs.total sales equal total fixed costs.20Turnbull Corp. had an EBIT
of $247 million in the last fiscal year. Its depreciation and amortization
expenses amounted to $84 million. The firm has 135 million shares outstanding
and a share price of $12.80. A competing firm that is very similar to Turnbull
has an enterprise value/EBITDA multiple of 5.40. What is the enterprise value of
Turnbull Corp.? Round to the nearest million dollars. $1,787 million$1,344

2. million$1,315 million$453.6 million21Which of the following is considered a
hybrid organizational form?partnershiplimited liability
partnershipcorporationsole proprietorship22The most important information needed
to determine if companies can pay their current obligations is the:projected net
income for next yearrelationship between short-term and long-term
liabilitiesrelationship between current assets and current liabilitiesnet income
for this year23Gateway, Corp. has an inventory turnover of 5.6. What is the
firm’s days’s sales in inventory? 61.757.965.264.324Horizontal analysis is also
known as:vertical analysislinear analysistrend analysiscommon size
analysis25Which of the following presents a summary of changes in a firm’s
balance sheet from the beginning of an accounting period to the end of that
accounting period? the statement of net worththe statement of working capitalthe
statement of cash flowsthe statement of retained earnings26 Ajax Corp. is
expecting the following cash flows - $79,000, $112,000, $164,000, $84,000, and
$242,000 – over the next five years. If the company’s opportunity cost is 15
percent, what is the present value of these cash flows? (Round to the nearest
dollar.) $477,235$429,560$414,322$480,90627Bond price: Regatta, Inc., has six-year
bonds outstanding that pay a 8.25 percent coupon rate. Investors buying the
bond today can expect to earn a yield to maturity of 6.875 percent. What should
the company's bonds be priced at today? Assume annual coupon payments. (Round to
the nearest dollar.)$972$1,066$1,014$923 28Process costing is used
when:dissimilar products are involvedproduction is aimed at fulfilling a
specific customer order.the production process is continuous.costs are to be
assigned to specific jobs.29Jack Robbins is saving for a new car. He needs to
have $21,000 for the car in three years. How much will he have to invest today
in an account paying 8 percent annually to achieve his target? (Round to nearest
dollar) $22,680$26,454$19,444$16,67030The accumulation of accounting data on the
basis of the individual manager who has the authority to make day-to-day
decisions about activities in an area is called:flexible accountingstatic
reportingmaster budgetingresponsibility accounting31Variance reports are:SEC
financial reportsinternal reports for managementexternal financial reportsall of
these32The cash conversion cycle?shows how long the firm keeps its inventory
before selling it.estimates how long it takes on average for the firm to collect
its outstanding accounts receivables balance.begins when the firm uses its cash
to purchase raw materials and ends when the firm collects cash payments on its
credit sales.begins when the firm invests cash to purchase the raw materials
that would be used to produce the goods that the firm manufactures.33In a
process cost system, product costs are summarized:when the products are sold.on
job cost sheets.on production cost reports.after each unit is
produced.34Internal reports that review the actual impact of decisions are
prepared by:the controllerdepartment headsfactory workersmanagement
accountants35How firms estimate their cost of capital: The WACC for a firm is
13.00 percent. You know that the firm’s cost of debt capital is 10 percent and
the cost of equity capital is 20% What proportion of the firm is financed with
debt? 70%50%30%33%36The group of users of accounting information charged with
achieving the goals of the business is
its:auditorsinvestorsmanagerscreditors37An unrealistic budget is more likely to
result when it:has been developed in a bottom up fashion.has been developed by
all levels of management.is developed with performance appraisal usages in
mind.has been developed in a top down fashion.38Jayadev Athreya has started his
first job. He will invest $5,000 at the end of each year for the next 45 years
in a fund that will earn a return of 10 percent. How much will Jayadev have at
the end of 45 years? $3,594,524$2,667,904$1,745,600$5,233,44239Firms that
achieve higher growth rates without seeking external financing: Have a low
plowback ratioare highly leveragedhave less equity and/or are able to generate
high net income leading to a high ROE.None of these40Teakap, Inc. has current
assets of $1,456,312 and total assets of $4,812,369 for the year ending
September 30, 2006. It also has current liabilities of $1,041,012, common
equity of $1,500,000 and retained earnings of $1,468,347. How much long-term
debt does the firm have? $803,010$1,844,022$2,123,612$2,303,010