Week 1 individual assignment finance

1.In limited liability partnerships, the liability protection does not protect partners from their own individual acts of malpractice. TRUE or FALSE Answer

2.Which of the following legal forms of organization is most expensive to organize?
a.Sole Proprietorships
d.Limited Partnerships

3.Under which of the following legal forms of organization, is ownership readily
a.Sole Proprietorships
d.Limited Partnerships

4.A major weakness of a partnership is
a.Limited Liability
b.Difficulty liquidating or transferring ownership
c.Access to capital markets
d.Low organization cost

5.About 75 percent of all business firms are
a.Sole Proprietorships
d.Limited Partnerships

6.Johnson, Inc. has just ended the calendar year making a sale in the amount of $10,000 of merchandise purchased during the year at a total cost of $7,000. Although the firm paid in full for the merchandise during the year, it has yet to collect at year end from the customer. The net profit and cash flow from this sale for the year are
a.$3,000 and $10,000, respectively
b.$3,000 and -$7,000, respectively
c.$7,000 and -$3,000, respectively
d.$3,000 and $7,000, respectively

7.The average tax rate of a corporation with ordinary income of $105,000 and a tax liability of $24,200 is
a.46 percent
b.23 percent
c.34 percent
d.15 percent

8.Consider two firms, Go Debt corporation and No Debt corporation. Both firms are expected to have earnings before interest and taxes of $100,000 during the coming year. In addition, Go Debt is expected to incur $40,000 in interest expenses as a result of its borrowings whereas No Debt will incur no interest expense because it does not use debt financing. However, No Debt will have to pay stockholders $40,000 in dividend income. Both firms are in the 40 percent tax bracket. Calculate the Earnings after tax for both firms. Which firm has the higher after-tax earnings? Which firm appears to have the higher cash flow? How do you account for the difference? Answer:

Go Debt No Debt
Earnings before interest and taxes
Less: Interest expense
Earnings before taxes
Less: Taxes (40%)
Earnings after taxes
Less: Dividends
Net Income

9.If a person requires greater return when risk increases, that person is said to be

10.The ________ is the extent of an asset’s risk. It is found by subtracting the pessimistic outcome from the optimistic outcome
b.Standard Deviation
c.Probability distribution

11.A(n) ________ portfolio maximizes return for a given level of risk, or minimizes risk for a given level of return. Answer

12.Examples of events that increase risk aversion include. Answer
a.a stock market crash
b.assassination of a key political leader
c.the outbreak of war
d.all of the above

13.Two approaches for dealing with project risk to capture the variability of cash inflows and NPVs are… Answer
a.sensitivity analysis and simulation
b.scenario analysis and simulation
c.sensitivity analysis and scenario analysis
d.none of the above

14.A firm had the following accounts and financial data for 2005

The firm’s net profit after taxes for 2005 was….. Answer

15.Firm ABC had operating profits of $100,000, taxes of $17,000, interest expense of $34,000 and preferred dividends of $5,000. What was the firm’s net profit after taxes?

16.Candy Corporation had pretax profits of $1.2 million, an average tax rate of 34 percent, and it paid preferred stock dividends of $50,000. There were 100,000 shares outstanding and no interest expense. What were Candy Corporation’s earnings per share….


17.The 2002 Sarbanes-Oxley Act was designed to

a.limit the compensation that could be paid to corporate CEOs
b.eliminate the many disclosure and conflict of interest problems of corporations
c.provide uniform international accounting standards
d.two of the above

18. The primary concern of creditors when assessing the strength of a firm is the firm’s.
c.short-term liquidity
d.share price

19.The analyst should be careful when conducting ratio analysis to ensure that
a.the overall performance of the firm is not judged on a single ratio
b.the dates of the financial statements being compared are the same
c.audited statements are used
d.the same account


20. The dominant form of organization with respect to receipts and net profits is the

a.  sole proprietorship.

b.  partnership.

c.  corporation.

d.  S‑corporation.

Custom Papers Pro
Calculate your paper price
Pages (550 words)
Approximate price: -

Why Work with Us

Top Quality and Well-Researched Papers

We always make sure that writers follow all your instructions precisely. You can choose your academic level: high school, college/university or professional, and we will assign a writer who has a respective degree.

Professional and Experienced Academic Writers

We have a team of professional writers with experience in academic and business writing. Many are native speakers and able to perform any task for which you need help.

Free Unlimited Revisions

If you think we missed something, send your order for a free revision. You have 10 days to submit the order for review after you have received the final document. You can do this yourself after logging into your personal account or by contacting our support.

Prompt Delivery and 100% Money-Back-Guarantee

All papers are always delivered on time. In case we need more time to master your paper, we may contact you regarding the deadline extension. In case you cannot provide us with more time, a 100% refund is guaranteed.

Original & Confidential

We use several writing tools checks to ensure that all documents you receive are free from plagiarism. Our editors carefully review all quotations in the text. We also promise maximum confidentiality in all of our services.

24/7 Customer Support

Our support agents are available 24 hours a day 7 days a week and committed to providing you with the best customer experience. Get in touch whenever you need any assistance.

Try it now!

Calculate the price of your order

Total price:

How it works?

Follow these simple steps to get your paper done

Place your order

Fill in the order form and provide all details of your assignment.

Proceed with the payment

Choose the payment system that suits you most.

Receive the final file

Once your paper is ready, we will email it to you.

Our Services

No need to work on your paper at night. Sleep tight, we will cover your back. We offer all kinds of writing services.


Essay Writing Service

No matter what kind of academic paper you need and how urgent you need it, you are welcome to choose your academic level and the type of your paper at an affordable price. We take care of all your paper needs and give a 24/7 customer care support system.


Admission Essays & Business Writing Help

An admission essay is an essay or other written statement by a candidate, often a potential student enrolling in a college, university, or graduate school. You can be rest assurred that through our service we will write the best admission essay for you.


Editing Support

Our academic writers and editors make the necessary changes to your paper so that it is polished. We also format your document by correctly quoting the sources and creating reference lists in the formats APA, Harvard, MLA, Chicago / Turabian.


Revision Support

If you think your paper could be improved, you can request a review. In this case, your paper will be checked by the writer or assigned to an editor. You can use this option as many times as you see fit. This is free because we want you to be completely satisfied with the service offered.