11. Whit a Subchapter S corporation
A. corporate income is taxed as directed income to stockholders
B. stockholders have the same liability as members of a partnership
C. the number of stockholders is unlimited
D. life of the corporation is limited
12. Some analysts believe that the term structure of interest rates is determined by the behavior of various types of financial institutions. This theory is called the
A. expectations hypothesis
B. segmentation theory
C. liquidity premium
D. theory of industry supply and demand for bonds
13. In examining the liquidity ratios, the primary emphasis is the firm's
A. ability to effectively employ its resources
B. overall debt position
C. ability to pay short-term obligations on time
D. ability to earn an adequate return
14. A corporation's board of directors:
A. is selected by and can be removed by management
B. can be voted out of power by the shareholders
C. has a lifetime appointment to the board
D. is selected by a vote of all corporate stakholders
15. What is your monthly mortgage payment on a loan for $150,000, at 6% for 20 years
A. $899.33
B. $1,265.79
C. $1,074.65
D. $1,089.91
16. Assuming a tax rate of 50%, the after-tax cost of a $200,000 dividend payment is
A. $200,000
B. $100,000
C. $-100,000
D. none of the above
17. The ABC Corp. had net income before taxes of $400,000 and sales of $2,000,000. If it is in the 50% tax bracket its after-tax profit margin is
A. 5%
B. 10%
C. 20%
D. 25%
18. A firm has a debt to equity ratio of 50%, debt of $300,000 and net income of $90,000. the return on equity is
A. 60%
B. 15%
C. 30%
D. not enough information
19. In general, the larger the portion of a firm's sales that are on credit, the
A. lower will be the firm's need to borrow
B. higher will be the firms need to borrow
C. more rapidly credit sales will be paid off
D. more the firm can buy raw materials on credit
20. If a firm has a break-even point of 20,000 units and the contribution margin on the firm's single product is $3.00 per unit and fixed costs are $60,000, what will the forms's net income be at sales of 30,000 units?
A. $90,000
B. $30,000
C. $15,000
D. $45,000
1 answer
1 answer