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NGÂN H̀NG CÂU H I

THI

H C PH N: FINANCIAL MANAGEMENT (FMGM0211)
(Dùng cho h đ i h c chính quy l p Ch t l

ng cao)

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B ng tr ng s trong m i
thi tr c nghi m Financial management
M c đ câu h i
Phân b câu h i
Ph n
Ghi ch́
theo ph n
C pđ 1 C pđ 2 C pđ 3
1
4
2
0
6
Overview of FM
2

3
3
4
TVM and financial ratio
10
3
2
3
0
Over view of WCM
5
4
1
1
1
3
Cash management
5
2
2
2
AR and Inventory management
6
6
2
1
0
Short-term financing
3
7

6
2
2
10
Investment in capital asset
8
4
1
1
6
Long-term financing
9
1
0
0
1
Special areas in FM
T ng
25
15
10
50
M i đ thi ć: 50 câu, phân b vào các ph n nh trên. Tùy theo h c ph n và tùy theo cách chia c a
B môn mà s Ph n có th khác nhau
Th i gian thi: 60 ph́t làm bài
Font ch s d ng cho Ngân hàng đ thi là Times New Roman; c ch 12
B ng l u ngân hàng câu h i cho m t h c ph n

STT N i dung câu h i
1.

The goal of the firm should
be:

2.

"Shareholder wealth" in a
firm is represented by:

3.

The long-run objective of
financial management is to:

4.

Investment decisions are
answers to questions:

5.

Financing decisions are
answers to questions:

6.

A market where new
securities are bought and

Ph ng ́n

A.Maximization of shareholder wealth.
B. Maximization of profits.
C. Maximization of consumer satisfaction.
D. Maximization of sales.
A. the market price per share of the firm's
common stock.
B. the number of people employed in the firm.
C. the book value of the firm's assets less the book
value of its liabilities
D. the amount of salary paid to its employees.
A. maximize the value of the firm's common
stock.
B. maximize earnings per share.
C. maximize return on investment.
D. maximize market share.
A. What is the optimal firm size?
B. What is the best type of financing?
C. What is the best financing mix?
D. What is the best dividend policy?
A. What is the best dividend policy?
B. What is the optimal firm size?
C. What specific assets should be acquired?
D. What assets should be eliminated?
A. Primary Market
B. Money Market
Trang 1


STT N i dung câu h i
sold for the first time is:

A market for existing (used)
securities rather than new
issues is:

8.

You are about to determine
your corporation’s taxable
income. Which of the below
would not be included as a
tax-deductible expense?

9.

Which of the following is
not the responsibility of
financial management?

Which of the following
10. items is NOT included in
current assets?

11. Cost of capital is:

12.

A. Dividend expense
B. Depreciation expense
C. Cost of goods sold
D. Marketing expenses

A. preparation of the firm's accounting statements
B. allocation of funds to current and capital assets
C. obtaining the best mix of financing alternatives
D. development of an appropriate dividend policy
A. Bonds.
B. Accounts receivable.
C. Inventory.
D. Cash.
A. the average cost of the firm’s assets.
B. the coupon rate of debt.
C. a hurdle rate set by the board of directors.
D. the after-tax cost of debt.
A. Short-term debt securities.
B. Foreign stocks.
C. Consumer automobile loans.
D. U.S. stocks.
A. individuals buying and selling the stock.
B. the board of directors of the firm.
C. the stock exchange on which the stock is listed.
D. the president of the company.
A. the creation of value for shareholders.
B. the number and types of products or services
provided by the firm.
C. the minimization of the amount of taxes paid
by the firm.
D. the dollars profits earned by the firm.
A. Bankers’ acceptances
B. Preferred stock
C. Corporate bonds
D. Common stock

A. Common stock
B. Negotiable certificates of deposit
C. Bankers’ acceptances
D. Commercial note
A. Market Value (per share)
B. Liquidating Value (per share)
C. Book Value (per share)
D. Par Value – The face value
A. Borrow short term to finance additional fixed
assets.
B. Issue long-term debt to buy inventory.
C. Sell common stock to reduce current liabilities.
D. Sell fixed assets to reduce accounts payable.

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7.

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C. Capital Market
D. Secondary Market
A. Secondary Market
B. Money Market
C. Capital Market
D. Primary Market

Money markets are markets

for

The market price of a share
13. of common stock is
determined by:

14.

The focal point of financial
management in a firm is:

15.

Money market instruments
include:

16.

Capital market instruments
include:

The current price at which
17. the stock is currently trading
is:
Which of the following
18. would NOT improve the
current ratio?

Trang 2

STT N i dung câu h i
The gross profit margin is
unchanged, but the net profit
19. margin declined over the
same period. This could
have happened if
The principal advantage of
20. the sole proprietorship form
of business organization is:
The principal advantage of
21. the corporate form of
business organization is that:

ng ́n

A. Govt. increased the tax rate.
B. cost of goods sold increased relative to sales.
C. sales increased relative to expenses.
D. dividends were decreased.
A. Single tax filing on individual form
B. Unlimited liability
C. Hard to raise additional capital
D. Transfer of ownership difficulties
A. Limited liability
B. Unlimited liability
C. Low setup cost
D. Personal tax on profits
A. sale of shares and bonds
B. credit management

C. inventory control
D. the receipt and disbursement of funds
A. Market value
B. Redemption value
C. Face value
D. Maturity value
A. Dividends
B. Face value
C. Redemption value
D. Book value

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Which of the following are
not among the daily
22.
activities of financial
management?

Ph

______________ is the price
23. at which the bond is traded
in the stock exchange.
______________ enhance
the market value of shares
24.

and therefore equity capital
is not free of cost.
A(n)_________________
would be an example of a
25. principal, while a(n)
______________ would be
an example of an agent.
______________ and
______________ are the
26. two versions of goals of the
financial management of the
firm.

A. shareholder; manager
B. manager; owner
C. accountant; bondholder
D. shareholder; bondholder
A. Profit maximisation, Wealth maximization
B. Production maximisation, Sales maximisation
C. Sales maximisation, Profit maximization
D. Value maximisation, Wealth maximisation

A. Use the income statement to determine
earnings after taxes (net income) and divide by
the number of common shares outstanding.
B. Use the income statement to determine
earnings after taxes (net income) and divide by
the previous period's earnings after taxes. Then
subtract 1 from the previously calculated value.
How are earnings per share

C. Use the income statement to determine
27.
calculated?
earnings after taxes (net income) and divide by
the number of common and preferred shares
outstanding.
D. Use the income statement to determine
earnings after taxes (net income) and divide by
the forecasted period's earnings after taxes. Then
subtract 1 from the previously calculated value
You saved VND 100 million A. VND 125.97 million
in 3 years with the
B. VND 124.00 million
28.
compound interest of 8% per C. VND 356.01 million
year. How much will you
D. VND 257.71 million
Trang 3


Ph

ng ́n

A. VND 163.76 million
B. VND 159.00 million
C. VND 346.01 million
D. VND 247.74 million

A. VND 188.96 million

B. VND 224.00 million
C. VND 376.61 million
D. VND 297.71 million

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STT N i dung câu h i
receive at the end of the
third year?
You saved VND 130 million
in 3 years with the
compound interest of 8% per
29.
year. How much will you
receive at the end of the
third year?
You saved VND 150 million
in 3 years with the
compound interest of 8% per
30.
year. How much will you
receive at the end of the
third year?
The future value is $115
after one year at annum
31.
interest rate of 10%, the

present value will be
The future value is $82.5
after 2 years at annum
32.
interest rate of 8%, the
present value will be
The future value is $500
after 5 year at annum
33.
interest rate of 15%, the
present value will be
An enterprise has total assets
of VND 254,000 million,
short-term debt is VND
34. 58,000 million, long-term
debt is VND 23,000 million.
What is the ratio of equity to
total assets?
An enterprise has total assets
of VND 508,000 million,
short-term debt is VND
35. 110,000 million, long-term
debt is VND 40,000 million.
What is the ratio of equity to
total assets?
An enterprise has total assets
of VND 635.000 million.
short-term debt is VND
36. 150.000 million; long-term
debt is VND 70.000 million.

What is the ratio of equity to
total assets?
Your firm has the following
income statement items:
sales of $50,250,000;
37. income tax of $1,744,000;
operating expenses of
$10,115,000; cost of goods
sold of $35,025,000; and

A. $104.55
B. $127.78
C. $126.5
D. $103.5
A. $70.73
B. $65.5
C. $70
D. $69.23
A. $248.59
B. $250
C. $267.63
D. $321.15
A. 68.11%
B. 31.89%
C. 77.16%
D. 22.84%

A. 70.47%
B. 51.79%
C. 67.86%

D. 28.64%

A. 65.35%
B. 41.89%
C. 78.16%
D. 52.83%

A. $4,360,000
B. $15,552,000
C. $58,000,000
D. $5,110,000

Trang 4


Ph

ng ́n

A. $0.50
B. $100,000
C. $6.00
D. $6.50

A. 9.54%
B. 8.54%
C. 20.00%
D. 10.00%
A. 11.61%
B. 9.54%

C. 15.00%
D. 13.25%
A. 14.47%
B. 13.54%
C. 15.00%
D. 12.25%

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STT N i dung câu h i
interest expense of
$750,000. What is the
amount of the firm’s
earnings before taxes?
What are the earnings per
share (EPS) for a company
that earned $100,000 last
year in after-tax profits, has
38.
200,000 common shares
outstanding and $1.2 million
in retained earning at the
year end?
Loan present value is $500
and future value is $600
39.
after 2 years; value of 'I =

interest rate' will be
Loan present value is $100
and future value is $300
40.
after 10 years; value of 'I =
interest rate' will be
Loan present value is $500
and future value is $750
41.
after 5 years; value of 'I =
interest rate' will be
SL Co. is looking for a 3month term source of $500
million to supplement
working capital. Viettinbank
42. accepts loans at annual
nominal rate of interest of
14% a year. Calculate the
annual effective rate of
interest:
SL Co. is looking for a 6month term source of $550
million to supplement
working capital. Viettinbank
43. accepts loans at annual
nominal rate of interest of
15% a year. Calculate the
annual effective rate of
interest:
SL Co. is looking for a 6month term source of $650
million to supplement
working capital. Viettinbank

44. accepts loans at annual
nominal rate of interest of
12% a year. Calculate the
annual effective rate of
interest:
OY has a total asset of
45. $3,600,000, short-term debt
of $300,000, long-term debt

A. 14,75%
B. 12,12%
C. 13,41%
D. 11,78%

A. 15,56%
B. 14,12%
C. 13,41%
D. 12,78%

A. 12,36%
B. 12,12%
C. 13,15%
D. 14,78%

A. 21,4%
B. 24,5%
C. 17,4%
Trang 5

Ph ng ́n
D. 20%
A. 23%
B. 24,5%
C. 18,4%
D. 20%
A. 16.67%
B. 20,5%
C. 18,4%
D. 17.04%
A. 15.28%
B. 17.32%
C. 21.47%
D. 18.74%

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STT N i dung câu h i
of $600,000, and net income
of $ 150,000, ROE ratio is:
OY has a total asset of
$2,500,000, short-term debt
46. of $350,000, long-term debt
of $600,000, and net income
of $ 230,000, ROE ratio is:
OY has a total asset of
$1,900,000, short-term debt

47. of $ 250,000, long-term debt
of $450,000, and net income
of $200,000, ROE ratio is:
AB has a total asset of $
3,600,000, short-term debt
of $ 600,000, long-term debt
48.
of $ 1,300,000, and net
income of $ 550,000, ROA
ratio is:
AB has a total asset of $
4,500,000, short-term debt
of $ 900,000, long-term debt
49.
of $ 1,300,000, and net
income of $ 850,000, ROA
ratio is:
AB has a total asset of $
2,400,000, short-term debt
of $500,000, long-term debt
50.
of $ 1,200,000, and net
income of $ 500,000, ROA
ratio is:
SL Co. is looking for a 4month term source of $600
million to supplement
working capital. Viettinbank
51.
accepts loans at discount
interest rate of 11% a year.

Calculate the annual
effective rate of interest:
SL Co. is looking for a 6month term source of $550
million to supplement
working capital. Viettinbank
52.
accepts loans at discount
interest rate of 11.2% a year.
Calculate the annual
effective rate of interest:
SL Co. is looking for a 3month term source of $650
million to supplement
working capital. Viettinbank
53.
accepts loans at discount
interest rate of 12% a year.
Calculate the annual
effective rate of interest:

A. 18.89%
B. 18.32%
C. 21.47%
D. 17.74%

A. 20.83%
B. 19.32%
C. 21.47%
D. 18.74%

A. 11.86%

B. 10.83%
C. 12.11%
D. 13.21%

A. 12.22%
B. 11.83%
C. 12.10%
D. 13.21%

A. 12.96%
B. 13.83%
C. 11.52%
D. 10.21%

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Ph

ng ́n

A. $109.79 million
B. $121.89 million
C. $122.89 million
D. $123.23 million

A. $47.69 million
B. $52.33 million
C. $49.65 million
D. $45.23 million

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STT N i dung câu h i
Mr. X takes a loan of $1,000
million from HSBC Bank.
The rate of interest is 7% per
annum. The first instalment
will be paid at the end of
54.
year 15. Determine the
amount of equal annual
instalments if Mr. X wishes
to repay the amount in 15
instalments.
Mr. X takes a loan of $320
million from HSBC Bank.
The rate of interest is 8% per
annum. The first instalment
will be paid at the end of
55.
year 10. Determine the
amount of equal annual
instalments if Mr. X wishes
to repay the amount in 10
instalments.
Mr. X takes a loan of $1,000

million from HSBC Bank.
The rate of interest is 7% per
annum. The first instalment
will be paid at the end of
56.
year 15. Determine the
amount of equal annual
instalments if Mr. X wishes
to repay the amount in 15
instalments.
Company X is looking for a
4-month term source of
VND 700 million. The bank
Y accepts a loan with
57.
interest rate of 9% per year
and deposits rate at 12%.
What is the annual effective
rate of interest?
Company X is looking for a
3-month term source of
VND 600 million. The bank
Y accepts a loan with
58.
interest rate of 8% per year
and deposits rateat 15%.
What is the annual effective
rate of interest?
Company X is looking for a
4-month term source of

VND 500 million. The bank
Y accepts a loan with
59.
interest rate of 8% per year
and deposits rate at 18%.
What is the annual effective
rate of interest?

A. $144.4 million
B. $121.3 million
C. $100 million
D. $135.2 million

A. 10.58%
B. 11.58%
C. 12.89%
D. 8.58%

A. 13.15%
B. 14.55%
C. 11.69%
D. 8.58%

A. 10.08%
B. 11.38%
C. 12.45%
D. 8.55%

Trang 7

Ph

ng ́n

A. $235,649
B. $225,000
C. $205,225
D. $215,000
A. $188,519
B. $175,050
C. $165,225
D. $185,402
A. $282,779
B. $279,500
C. $265,225
D. $275,000

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STT N i dung câu h i
To receive $250,000 from
the bank after 2 years, what
60. is your initial investment if
the interest rate is 3%?
(compound interest)
To receive $200,000 from

the bank after 2 years, what
61. is your initial investment if
the interest rate is 3%?
(compound interest)
To receive $300,000 from
the bank after 2 years, what
62. is your initial investment if
the interest rate is 3%?
(compound interest)
Company X has a total asset
of $ 4,650,000; short-term
debt of $ 800,000; long-term
63.
debt of $ 2,300,000 and net
income of $ 750,000. What
is the ROA?
Company X has a total asset
of $ 2,325,000; short-term
debt of $ 400,000; long-term
64.
debt of $ 1,150,000 and net
income of $ 350,000. What
is the ROA?
Company X has a total asset
of $ 5,580,000; short-term
debt of $ 960,000; long-term
65.
debt of $ 2,760,000 and net
income of $ 350,000. What
is the ROA?

Mr. Nam plans to save VND
10 million every year in 20
year to a pension fund with
66. interest rate of 10% per year
(compound interest). After
20 years; how much he will
receive?
Mr. Nam plans to save VND
15 million every year in 20
year to a pension fund with
67. interest rate of 10% per year
(compound interest). After
20 years; how much he will
receive?
Mr. Nam plans to save VND
20 million every year in 20
year to a pension fund with
68. interest rate of 10% per year
(compound interest). After
20 years; how much he will
receive?

A. 16.1%
B. 17.3%
C. 20.4%
D. 19.7%

A. 15.1%
B. 17.2%
C. 25.4%

D. 14.7%

A. 14.7%
B. 15.3%
C. 16.4%
D. 13.4%

A. VND 572.75 million
B. VND 675.62 million
C. VND 67.27 million
D. VND 76.27 million

A. VND 859.12 million
B. VND 805.62 million
C. VND 457.27 million
D. VND 777.27 million

A. VND 1145.50 million
B. VND 965.62 million
C. VND 1067.27 million
D. VND 776.27 million

Trang 8


Ph

ng ́n

A. 22.1%

B. 24.5%
C. 19.4%
D. 17.5%

A. 21.1%
B. 24.9%
C. 19.2%
D. 13.7%

A. 24.6%
B. 23.5%
C. 18.4%
D. 16.5%

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STT N i dung câu h i
Company X has a total asset
of $ 2,130,000. short-term
debt of $ 430,000. long-term
69.
debt of $ 750,000, net
income of $ 210,000. What
is company X’s ROE?
Company X has a total asset
of $ 1,065,000. short-term
debt of $ 215,000. long-term

70.
debt of $ 375,000. net
income of $ 100,000. What
is company X’s ROE?
Company X has a total asset
of $ 3,195,000. short-term
debt of $ 645,000. long-term
71.
debt of $ 1,125,000. net
income of $ 350,000. What
is company X’s ROE?
The present value is VND
800 million. After 4 years
72. with an annum interest rate
of 14% (compound interest).
the future value will be:
The present value is VND
700 million. After 4 years
73. with an annum interest rate
of 14% (compound interest).
the future value will be:
The present value is VND
600 million. After 4 years
74. with an annum interest rate
of 14% (compound interest).
the future value will be:
________________ refers to
the amount invested in
75.
various components of

current assets.
________________ is the
length of time between the
76. firm’s actual cash
expenditure and its own cash
receipt.
77. Net Working Capital is:

The amount of current assets
78. that varies with seasonal
requirements is:
The amount of current assets
79. required to meet a firm’s
long-term minimum needs

A. VND 1,351.17 million
B. VND 1,248.05 million
C. VND 4,488.08 million
D. VND 2,330.96 million
A. VND 1,182.27 million
B. VND 1,548.09 million
C. VND 1,288.06 million
D. VND 2,630.93 million
A. VND 1,013.38 million
B. VND 1,148.02 million
C. VND 1,488.02 million
D. VND 1,330.98 million

A. Gross working capital
B. Temporary working capital

C. Net working capital
D. Permanent working capital
A. Net operating cycle
B. Cash conversion cycle
C. Working capital cycle
D. Gross operating cycle

A. Current Assets - Current Liabilities
B. Current Assets + Current Liabilities
C. Current Assets / Current Liabilities
D. Current Liabilities - Current Assets
A. Temporary current assets
B. Permanent current assets
C. Temporary fixed assets
D. Permanent fixed assets
A. Permanent current assets
B. Temporary current assets
C. Temporary fixed assets
D. Permanent fixed assets
Trang 9


STT N i dung câu h i
_______________ refers to
the length of time allowed
80. by a firm for its customers to
make payment for their
purchases.
____________ is NOT a
part of Current Assets

82.

________________ is a part
of Current Liabilities

ng ́n

A. Credit period
B. Holding period
C. Pay-back period
D. Average collection period
A. Accounts Payable
B. Cash
C. Accounts Receivable
D. Inventory
A. Accounts Payable
B. Cash
C. Accounts Receivable
D. Inventory
A. is the amount of current assets required to meet
a firm's long-term minimum needs.
B. varies with seasonal needs.
C. includes fixed assets.
D. includes accounts payable.
A. plus its receivable turnover in days (RTD).
B. minus its RTD.
C. plus its RTD minus its payable turnover in
days (PTD).
D. minus its RTD minus its PTD.

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81.

Ph

83. Permanent working capital

A firm's operating cycle is
84. equal to its inventory
turnover in days (ITD)

A (n) __________________
current operating asset
financing approach will
85. result in permanent current
assets and some seasonal
current assets being financed
using long-term securities.
Which of the following
illustrates the use of a
86.
hedging (or matching)
approach to financing?

In deciding the appropriate

level of current assets for the
87.
firm, management is
confronted with
Although short-term interest
rates have historically
averaged less than long-term
rates, the heavy use of shortterm debt is considered to be
88.
a(an) ___________current
operating asset financing
strategy because of the
inherent risks of using shortterm financing.
Which of the following
89.
would be consistent with a

A. conservative
B. aggressive
C. maturity matching
D. wrong

A. Permanent working capital financed with longterm liabilities.
B. Short-term assets financed with long-term
liabilities.
C. Short-term assets financed with equity.
D. All assets financed with 50 percent equity, 50
percent long-term debt mixture.
A. a trade-off between profitability and risk.
B. a trade-off between liquidity and marketability.

C. a trade-off between equity and debt.
D. a trade-off between short-term versus longterm borrowing.

A. aggressive
B. conservative
C. maturity matching
D. wrong

A. Financing some long-term needs with shortterm funds.
Trang 10


STT N i dung câu h i
more aggressive approach
tofinancing working capital?

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Which of the following
90. working capital strategies is
the most aggressive?

Ph ng ́n
B. Financing short-term needs with short-term
funds.
C. Financing permanent inventory buildup with
long-term debt.

D. Financing seasonal needs with short-term
funds.
A. Making greater use of short term finance and
minimizing net short term asset.
B. Making greater use of short term finance and
maximizing net short term asset.
C. Making greater use of long term finance and
minimizing net short term asset.
D. Making greater use of long term finance and
maximizing net short term asset.
A. matching the maturities of assets and liabilities
reduces risk under some circumstances, and also
because short-term debt is often less expensive
than long-term capital.
B. short-term interest rates have traditionally been
more stable than long-term interest rates.
C. a firm that borrows heavily on a long-term
basis is more apt to be unable to repay the debt
than a firm that borrows short term.
D. short-term debt has a higher cost than equity
capital.
A. Merchandise is sold at a profit, but the sale is
on credit.
B. Cash is used to buy marketable securities.
C. A cash dividend is declared and paid.
D. Long-term bonds are retired with the proceeds
of a preferred stock issue.

Firms generally choose to
finance temporary current

91.
operating assets with shortterm debt because

Other things held constant,
which of the following will
92.
cause an increase in net
working capital?

The principal advantage of
Maturity matching approach
in financing strategy is that:
93.

A. Reduces liquidity risk
B. Easy to implement in practice
C. Hard to implement in practice
D. High proportion of short term debt

The principal advantage of
Conservative approach in
financing strategy is that:
94.

A. Less worry in refinancing short-term
obligations
B. Borrowing at a higher overall cost
C. Uncertain regarding future interest costs
D. Borrowing more than what is necessary

The principal advantage of
95. Aggressive approach in
financing strategy is that:

A. Borrowing only what is necessary
B. Less uncertainty regarding future interest costs
C. Uncertain future interest costs
D. Refinancing short-term obligations in the
future
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STT N i dung câu h i

The mix between short-term
96. and long-term debt must
consider:

The mix between short-term
98. and long-term debt must
consider:
Which asset-liability
combination would most
99. likely result in the firm's
having the greatest risk of
technical insolvency?

100.

______________ varies

inversely with profitability.

When total current assets
101. exceeds total current
liabilities it refers to
Which of the following
102. would NOT be financed
from working capital?

103.

ng ́n

A. Industry norms
B. Customer satisfaction
C. Cost of equity
D. Hobby of CFO
A. Variability of sales
B. Customer satisfaction
C. Cost of equity
D. Hobby of CFO
A. Variability of cash flows
B. Customer satisfaction
C. Cost of equity
D. Hobby of CFO
A. Reducing current assets, increasing current
liabilities, and reducing long-term debt.
B. Increasing current assets while lowering
current liabilities.
C. Increasing current assets while incurring more

current liabilities.
D. Replacing short-term debt with equity.
A. Liquidity.
B. Risk.
C. Financing.
D. Liabilities.
A. Net Working Capital
B. Gross Working Capital
C. Temporary Working Capital
D. Temporary Current Assets
A. A new personal computer for the office.
B. Cash float.
C. Accounts receivable.
D. Credit sales.
A. Although short-term interest rates have
historically averaged less than long-term rates, the
heavy use of short-term debt is considered to be
an aggressive strategy because of the inherent
risks associated with using short-term financing.
B. Net working capital is defined as current assets
minus the sum of payables and accruals, and any
increase in the current ratio automatically
indicates that net working capital has increased.
C. If a company follows a policy of "matching
maturities," this means that it matches its use of
common stock with its use of long-term debt as
opposed to short-term debt.
D. Net working capital is defined as current assets
minus the sum of payables and accruals, and any
decrease in the current ratio automatically

indicates that net working capital has decreased.

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97. and long-term debt must
consider:

Ph

Which of the following
statements is CORRECT?

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Ph

ng ́n

A. $885,000
B. $1,550,000
C. $600,000
D. $325,000

A. Transaction motive
B. Speculative motive

C. Precautionary motive
D. Compensating motive

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Your firm has the following
balance sheet statement
items: total current liabilities
of $805,000; total assets of
104. $2,655,000; fixed and other
assets of $1,770,000; and
long-term debt of $200,000.
What is the amount of the
firm’s total current assets?
_______________ refers to
a firm holding some cash to
105. meet its routine expenses
that are incurred in the
ordinary course of business.
Cash management decisions
must consider the risk versus
106. expected return trade-offs
from alternative policies
because:

The first priority item in

107. choosing marketable
securities is:

Marketable securities are
108.
primarily

Which would be an
appropriate investment for
temporarily idle corporate
109.
cash that will be used to pay
quarterly dividends three
months from now?

Which of the following
marketable securities is the
110.
obligation of a commercial
bank?
Helena Furnishings wants to
reduce its cash conversion
111. cycle. Which of the
following actions should it
take?

A. Too little cash increases risk; too much cash
reduces return
B. Too little cash reduce risk; too much cash
reduces return

C. Too little cash increases risk; too much cash
increases return
D. Too little cash reduces risk; too much cash
increases return
A. Lowest risk and ability to sell quickly without
significant price concession
B. Expected return and ability to sell quickly
without significant price concession
C. Longer maturities and higher rate of return
D. Higher rate of return
A. short-term debt instruments.
B. short-term equity securities.
C. long-term debt instruments.
D. long-term equity securities.
A. Ninety-day commercial paper with a current
annual yield of 6.2 percent.
B. A long-term AAA-rated corporate bond with a
current annual yield of 9.4 percent.
C. A 30-year Treasury bond with a current annual
yield of 8.7 percent.
D. Common stock that has been appreciating in
price 8 percent annually, on average, and paying a
quarterly dividend that is the equivalent of a 5
percent annual yield.
A. Negotiable certificate of deposit
B. Commercial paper
C. Repurchase agreement
D. T-bills
A. Take steps to reduce the Days sales
outstanding – DSO

B. Increase average inventory without increasing
sales
C. Start paying its bills sooner, which would
reduce the average accounts payable but not affect
sales
D. Sell common stock to retire long-term bonds
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STT N i dung câu h i
Other things held constant,
which of the following
112.
would tend to reduce the
cash conversion cycle?

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Which of the following is
NOT directly reflected in the
113.
cash budget of a firm that is
in the zero tax bracket?

Which of the following
actions would be likely to
114.

shorten the cash conversion
cycle?

115.

116.

117.

118.

Ph ng ́n
A. Continue to take all discounts that are offered
and pay on the net date
B. Carry a constant amount of receivables as sales
decline
C. Place larger orders for raw materials to take
advantage of price breaks
D. Offer longer payment terms to customers
A. Depreciation
B. Payments lags
C. Repurchases of common stock
D. Payment for plant construction
A. a new manufacturing process that speeds up
the conversion of raw materials to finished goods
from 20 days to 10 days
B. Change the credit terms offered to customers
from 3/10 net 30 to 1/10 net 50
C. Begin to take discounts on inventory
purchases; we buy on terms of 2/10 net 30

D. Adopt a new manufacturing process that saves
some labor costs but slows down the conversion
of raw materials to finished goods from 10 days to
20 days

AT Co., Ltd has total
demand for money is $3
billion. The cost of
transferring securities in
cash is $250,000, the return
on securities is 15% a year.
According to the BaumolAllais-Tobin (BAT) optimal
reserve model, the optimal
reserve amount is
AT Co., Ltd has total
demand for money is $1
billion. The cost of
transferring securities in
cash is $ 200,000, the return
on securities is 12% a year.
According to the BaumolAllais-Tobin (BAT) optimal
reserve model, the optimal
reserve amount is
AT Co., Ltd has total
demand for money is $ 4
billion. The cost of
transferring securities in
cash is $ 250,000, the return
on securities is 20% a year.
According to the BaumolAllais-Tobin (BAT) optimal

reserve model, the optimal
reserve amount is
Amounts due from
customers when goods are

A. $100 million
B. $50 million
C. $150 million
D. $200 million

A. $57.7 million
B. $50.4 million
C. $100 million
D. $60 million

A. $100 million
B. $150 million
C. $90 million
D. $120 million

A. Trade debits
B. Trade balance
Trang 14


Ph ng ́n
C. Trade discount
D. Trade off
A. Payments deferral period
B. Collection policy

C. Credit standards
D. Cash discounts

A. 45 days.
B. 90 days.
C. 75 days.
D. 60 days.

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sold on credit are called
_____________.
Which of the following is
NOT commonly regarded as
119.
being a credit policy
variable?
Given an accounts
receivable turnover of 8
times and annual credit sales
of $762,000 and the average
120.
accounts receivable of
$95,250 the average
collection period (360-day
year) is:

Given an accounts
receivable turnover of 8
times, annual credit sales of
121. $428,000 and average
collection period (360-day
year) is 45 days, the average
accounts receivable is:

In ABC inventory
122. classification model, items
class A is:

Sears sells mattresses at all
stores located in the Toronto
area. The mattresses are
stored in a central
warehouse. Annual demand
is 2,400 mattresses, spread
evenly throughout the year.
123.
The cost of placing and
receiving an order is $32.
The annual carrying cost is
$10/unit. What is the size of
the order Sears should place
with its supplier to minimize
its inventory cost?
A firm's inventory turnover
(IT) is 5 times on a cost of
goods sold (COGS) of

$800,000. If the IT is
124. improved to 8 times while
the COGS remains the same,
a substantial amount of
funds is released from or
additionally invested in

A. $53,500
B. $8,044
C. $58,400
D. $35,500

A. large dollar value items but comprise a
relatively small percentage of the total number of
items held in inventory
B. low dollar value items but comprise a large
percentage of the total items held in inventory
C. low dollar value items but comprise a
relatively small percentage of the total number of
items held in inventory
D. large dollar value items but comprise a large
percentage of the total items held in inventory

A. 124 units
B. 150 units
C. 168 units
D. 172 units

A. $60,000 is released.
B. $160,000 is released.

C. $100,000 is additionally invested.
D. $60,000 is additionally invested.

Trang 15


An increase in the firm's
128. receivable turnover ratio
means that:

129.

Ph

ng ́n

A. 73 days and $108,000.
B. 365 days and $108,000.
C. 73 days and $120,000.
D. 81 days and $108,000.

A. an increase in the average collection period.
B. a decrease in bad debt losses.
C. an increase in sales.
D. higher profits.

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inventory. In fact,
Ninety-percent of X
company's total sales of
$600,000 is on credit. If its
year-end receivables
125. turnover is 5, the average
collection period (based on a
365-day year) and the yearend receivables are,
respectively:
Increasing the credit period
from 30 to 60 days, in
response to a similar action
126.
taken by all of our
competitors, would likely
result in:
The credit policy of Spurling
Products is "1.5/10, net 35."
At present 30% of the
customers take the discount,
62% pay within the net
127.
period, and the rest pay
within 45 days of invoice.
What would receivables be
if all customers took the
cash discount?

Costs of not carrying enough
inventory include:

Credit policy of
every
company
is
by
130. largely influenced
_____________ and
_____________ .
Which of the following
statements is most consistent
131. with efficient inventory
management? The firm has
a
Vogel Bird Seed's total sales
of $1,320 million is on
credit. The company has an
average accounts receivable
132.
balance for the year of $165
million. The average
collection period would be
(Assume a 360-day year)

A. Lower than the present level.
B. No change from the present level.
C. Higher than the present level.
D. Unable to determine without more information.

A. it is collecting credit sales more quickly than
before.
B. cash sales have decreased.
C. it has initiated more liberal credit terms.
D. inventories have increased.
A. lost sales; customer disappointment; possible
worker layoffs.
B. lost sales.
C. customer disappointment.
D. possible worker layoffs.
A. Liquidity, profitability
B. Liquidity, accountability
C. Liability, profitability
D. Liability, liquidity
A. low incidence of production schedule
disruptions.
B. below average inventory turnover ratio.
C. below average total assets turnover ratio.
D. relatively high current ratio.

A. 45 days
B. 36 days
C. 40,7 days
D. 30 days

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Ph

ng ́n

A. 50 days
B. 47 days
C. 55 days
D. 30 days

A. 70 days
B. 67 days
C. 60 days
D. 85 days

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Vogel Bird Seed's total sales
of $1,800 million is on
credit. The company has an
average accounts receivable
133.
balance for the year of $250
million. The average
collection period would be
(Assume a 360-day year)
Vogel Bird Seed's total sales
of $1,800 million is on

credit. The company has an
average accounts receivable
134.
balance for the year of $350
million. The average
collection period would be
(Assume a 360-day year)
Annual demand is 3,500
units, spread evenly
throughout the year. The
price of product is
VND300,000 per unit. The
cost of placing and receiving
135.
an order is VND150,000.
The annual carrying cost is
12% per unit price. What is
the size of the order should
place with its supplier to
minimize its inventory cost?
Annual demand is 1500
units, spread evenly
throughout the year. The
price of product is
VND760,000 per unit. The
cost of placing and receiving
136.
an order is VND200,000.
The annual carrying cost is
12% per unit price. What is

the size of the order should
place with its supplier to
minimize its inventory cost?
Annual demand is 5000
units, spread evenly
throughout the year. The
price of product is
VND500,000 per unit. The
cost of placing and receiving
137.
an order is VND250,000.
The annual carrying cost is
15% per unit price. What is
the size of the order should
place with its supplier to
minimize its inventory cost?
Company X has the total
138. demand of materials is 1800
units a year. The price is

A. 171 units
B. 148 units
C. 117 units
D. 184 units

A. 82 units
B. 94 units
C. 85 units
D. 76 units

A. 183 units
B. 165 units
C. 185 units
D. 176 units

A. 30 units
B. 28 units
C. 31 units
Trang 17


Ph ng ́n
D. 29 units

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VND 350.000/unit. The cost
of placing and receiving an
order is VND 230.000. The
annual carrying cost is 10%
of the price. According to
EOQ model. what is the
company's re-ordering
point?
(suppose that a year has 360
days. the time of purchase is

6 days)
Company X has the total
demand of materials is 1500
units a year. The price is
VND 280.000/unit. The cost
of placing and receiving an
order is VND 184.000. The
annual carrying cost is 8%
139.
of the price. According to
EOQ model. what is the
company's re-ordering
point?
(suppose that a year has 360
days. the time of purchase is
6 days)
Company X has the total
demand of materials is 2100
units a year. The price is
VND 400.000/unit. The cost
of placing and receiving an
order is VND 250.000. The
annual carrying cost is 12%
140.
of the price. According to
EOQ model. what is the
company's re-ordering
point?
(suppose that a year has 360
days. the time of purchase is

6 days)
A credit transaction has
conditional payment of 3/10
net 60. In case the buyer
141.
pays on the 60th day of
delivery; what is the
commercial credit cost?
A credit transaction has
conditional payment of 2/10
net 50. In case the buyer
142.
pays on the 50th day of
delivery; what is the
commercial credit cost?
A credit transaction has
conditional payment of
143.
3/15net 60. In case the buyer
pays on the 60th day of

A. 25 units
B. 27 units
C. 31 units
D. 20 units

A. 35 units
B. 25 units
C. 30 units
D. 20 units

A. 22.27%
B. 12.24%
C. 16.89%
D. 15.90%

A. 18.37 %
B. 14.29%
C. 16.92 %
D. 15.96 %
A. 24.74%
B. 19.24%
C. 18.87%
D. 22.91%
Trang 18


Ph

ng ́n

A. 323 units
B. 232 units
C. 117 units
D. 401 units

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delivery; what is the
commercial credit cost?
Company X has the total
demand of materials is 5,500
units a year. The price is
VND 260,000 per unit. The
cost of placing and receiving
144. an order is VND 370,000.
The annual carrying cost is
15% of the price. According
to EOQ model, what is the
best size of the orderto
minimize the inventory cost?
Company X has the total
demand of materials is
11,000 units a year. The
price is VND 520,000 per
unit. The cost of placing and
receiving an order is VND
145.
700,000. The annual
carrying cost is 15% of the
price. According to EOQ
model, what is the best size
of the orderto minimize the
inventory cost?
Company X has the total
demand of materials is 8,250

units a year. The price is
VND 400,000 per unit. The
cost of placing and receiving
146. an order is VND 555,000.
The annual carrying cost is
15% of the price. According
to EOQ model, what is the
best size of the orderto
minimize the inventory cost?

A. 444 units
B. 332 units
C. 417 units
D. 405 units

A. 391 units
B. 335 units
C. 210 units
D. 301 units

Spontaneous financing
147.
includes

A. accounts payable.
B. accounts receivable.
C. short-term loans.
D. a line of credit.

XYZ is an oil based business

company, which does not
have adequate working
capital. It fails to meet its
148. current obligation, which
leads to bankruptcy. Identify
the type of decision involved
to prevent risk of
bankruptcy.

A. Liquidity decision.
B. Investment decision.
C. Dividend decision.
D. Finance decision.

149.

Which of the following
statements is CORRECT?

A. Under normal conditions, a firm's expected
ROE would probably be higher if it financed with
short-term rather than with long-term debt, but
using short-term debt would probably increase the
firm's risk
Trang 19


150.

Ph ng ́n

B. Conservative firms generally use no short-term
debt and thus have zero current liabilities
C. A short-term loan can usually be obtained
more quickly than a long-term loan, but the cost
of short-term debt is normally higher than that of
long-term debt
D. If a firm that can borrow from its bank at a 6%
interest rate buys materials on terms of 2/10 net
30, and if it must pay by Day 30 or else be cut off,
then we would expect to see zero accounts
payable on its balance sheet
A. Commercial paper is a form of short-term
financing that is primarily used by large, strong,
financially stable companies
B. Trade credit is provided only to relatively
large, strong firms
C. Commercial paper can be issued by virtually
any firm so long as it is willing to pay the going
interest rate
D. Commercial paper is typically offered at a
long-term maturity of at least five years
A. Commercial paper can be issued by virtually
any firm so long as it is willing to pay the going
interest rate
B. Accruals are "free" in the sense that no explicit
interest is paid on these funds
C. A conservative approach to working capital
management will result in most if not all
permanent current operating assets being financed
with long-term capital

D. Bank loans generally carry a higher interest
rate than commercial paper
A. If a firm wants to generate more cash flow
from operations in the next month or two, it could
change its credit policy from 2/10 net 30 to net 60
B. A company may hold a relatively large amount
of cash and marketable securities if it is uncertain
about its volume of sales, profits, and cash flows
during the coming year
C. Credit policy has an impact on working capital
because it influences both sales and the time
before receivables are collected
D. The cash budget is useful to help estimate
future financing needs, especially the need for
short-term working capital loans
A. An informal line of credit and a revolving
credit agreement are similar except that the line of
credit creates a legal obligation for the bank and
thus is a more reliable source of funds for the
borrower
B. Funds from short-term loans can generally be
obtained faster than from long-term loans for two
reasons: (1) when lenders consider long-term
loans they must make a more thorough evaluation
of the borrower's financial health, and (2) long-

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Which of the following
statements is CORRECT?

Which of the following
151. statements is NOT
CORRECT?

Which of the following
152. statements is NOT
CORRECT?

Which of the following
153. statements is NOT
CORRECT?

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Ph ng ́n
term loan agreements are more complex
C. The maturity of most bank loans is short term.
Bank loans to businesses are frequently made as
90-day notes which are often rolled over, or
renewed, rather than repaid when they mature.
However, if the borrower's financial situation
deteriorates, then the bank may refuse to roll over
the loan

D. Loans from commercial banks generally
appear on balance sheets as notes payable. A
bank's importance is actually greater than it
appears from the dollar amounts shown on
balance
sheets
because
banks
provide
nonspontaneous funds to firms
A. The maturity matching, or "self-liquidating,"
approach to financing involves obtaining the
funds for permanent current assets with a
combination of long-term capital and short-term
capital that varies depending on the level of
interest rates. When short-term rates are
relatively high, short-term assets will be financed
with long-term debt to reduce costs
B. A promissory note is the document signed
when a bank loan is executed, and it specifies
financial aspects of the loan
C. A line of credit can be either a formal or an
informal agreement between a borrower and a
bank regarding the maximum amount of credit the
bank will extend to the borrower during some
future period, assuming the borrower maintains its
financial strength
D. If a firm has set up a revolving credit
agreement with a bank, the risk to the firm of
being unable to obtain funds when needed is

lower than if it had an informal line of credi
A. The facts (1) that no explicit interest is paid on
accruals and (2) that the firm can control the level
of these accounts at will makes them an attractive
source of funding to meet working capital needs
B. Accruals are "free" capital in the sense that no
explicit interest must normally be paid on accrued
liabilities
C. Accruals are "spontaneous," but unfortunately,
due to law and economic forces, firms have little
control over the level of these accounts
D. Short-term financing is riskier than long-term
financing since, during periods of tight credit, the
firm may not be able to rollover (renew) its debt.
This is especially true if the funds are used to
finance long-term assets rather than short-term
assets
A. 18.18%
B. 20.20%
C. 19.19%
D. 21.21%

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Which of the following

154. statements is NOT
CORRECT?

Which of the following
155. statements is NOT
CORRECT?

A trade credit discount such
as 1/10 net 30. What is the
156.
annual cost of not accepting
the 1% discount?

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Ph ng ́n
A. 14.55%
B. 15.44%
C. 12.35%
D. 13.25%
A. 12.12%
B. 11.44%
C. 12.55%
D. 11.25%
A. 10.39%
B. 10.93%
C. 19.03%
D. 19.93%
A. 9.09%

B. 10.09%
C. 11.09%
D. 8.09%
A. 36.73%
B. 37.63%
C. 33.67%
D. 35.18%
A. 20.99%
B. 21.99%
C. 22.99%
D. 19.29%
A. depreciation.
B. dividends.
C. interest payments.
D. taxes.
A. method of project financing used.
B. accelerated depreciation.
C. salvage value.
D. tax rate changes.
A. it avoids the problem of computing the
required rate of return for each investment
proposal.
B. it is the only way to measure a firm's required
return.
C. it acknowledges that most new investment
projects have about the same degree of risk.
D. it acknowledges that most new investment
projects offer about the same expected return.
A. it is cash, not accounting income, that is central
to the firm's capital budgeting decision.

B. it is simpler to calculate cash flows than
income flows.
C. this is required by the Internal Revenue
Service.
D. this is required by the Securities and Exchange
Commission.
A. has the prospect of long-term benefits.
B. has the prospect of short-term benefits.
C. is only undertaken by large corporations.
D. applies only to investment in fixed assets.
A. Discounting technique

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A trade credit discount such
as 1/10 net 35. What is the
157.
annual cost of not accepting
the 1% discount?
A trade credit discount such
as 1/10 net 40. What is the
158.
annual cost of not accepting
the 1% discount?
A trade credit discount such
as 1/10 net 45. What is the

159.
annual cost of not accepting
the 1% discount?
A trade credit discount such
as 1/10 net 50. What is the
160.
annual cost of not accepting
the 1% discount?
A trade credit discount such
as 2/10 net 30. What is the
161.
annual cost of not accepting
the 2% discount?
A trade credit discount such
as 2/10 net 45. What is the
162.
annual cost of not accepting
the 2% discount?
Which of the following is
163. NOT a cash outflow for the
firm?
All of the following
164. influence capital budgeting
cash flows EXCEPT:

A single, overall cost of
165. capital is often used to
evaluate projects because:

The estimated benefits from

a project are expressed as
166.
cash flows instead of income
flows because:

167.

A capital investment is one
that

168. In the _______________,

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STT N i dung câu h i
the future value of all cash
inflow at the end of time
horizon at a particular rate of
interest is calculated.
When __________ is greater
169. than zero the project should
be accepted.

A. Net present value
B. Internal rate of return
C. Profitability index
D. Modified internal rate of return
A. Payback-period
B. Inventory conversion period

C. Discounted payback-period
D. Budget period
A. present value; initial cash outlay
B. net present value; initial cash outlay
C. present value; depreciable basis
D. net present value; depreciable basis

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____________ is defined as
the length of time required
170.
to recover the initial cash
out-lay.
A project's profitability
index is equal to the ratio of
171. the ________ of a project's
future cash flows to the
project's __________

Ph ng ́n
B. Risk-free rate
C. Compounding technique
D. Risk Premium

To increase a given present
172. value, the discount rate

should be adjusted

In order to maximize firm
value, management should
173.
invest in new assets when
the internal rate of return is:

174.

The firm should accept
independent projects if:

175.

If the IRR is greater than the
required rate of return, the:

Which of the following
investments would have the
highest future value at the
end of 10 years? Assume
176.
that the effective annual rate
for all investments is the
same and is greater than
zero.

Which of the following
investments would have the

177. lowest present value?
Assume that the effective
annual rate for all

A. downward.
B. upward.
C. no change.
D. constant.
A. greater or equal to the firm’s marginal cost of
capital.
B. greater than the cost of debt financing.
C. less than the firm’s marginal cost of capital.
D. less than the accounting rate of return.
A. the profitability index is greater than 1.0.
B. the payback is less than the IRR.
C. the IRR is positive.
D. the NPV is greater than the IRR.
A. present value of all the cash inflows will be
greater than the initial outlay.
B. payback will be less than the life of the
investment.
C. project should be rejected.
D. payback will be greater than the life of the
investment.
A. Investment a pays $250 at the beginning of
every year for the next 10 years (a total of 10
payments).
B. Investment a pays $125 at the end of every 6month period for the next 10 years (a total of 20
payments).
C. Investment a pays $125 at the beginning of

every 6-month period for the next 10 years (a total
of 20 payments).
D. Investment a pays $250 at the end of every
year for the next 10 years (a total of 10
payments).
A. Investment a pays $250 at the end of every
year for the next 10 years (a total of 10
payments).
B. Investment a pays $125 at the end of every 6month period for the next 10 years (a total of 20
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STT N i dung câu h i
investments is the same and
is greater than zero.

A profitability index of 0.85
for a project means that:

179.

Which of the following
statements is correct?

180.

181.

182.

183.

184.

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178.

Ph ng ́n
payments).
C. Investment a pays $125 at the beginning of
every 6-month period for the next 10 years (a total
of 20 payments).
D. Investment a pays $250 at the beginning of
every year for the next 10 years (a total of 10
payments).
A. the project returns 85 cents in present value for
each current dollar invested.
B. the present value of benefits is 85% greater
than the project's costs.
C. the project's NPV is greater than zero.
D. the payback period is less than one year.
A. If the PI of a project is less than 1, its NPV
should be less than 0.
B. If the NPV of a project is greater than 0, its PI
will equal 0.
C. If the IRR of a project is 0%, its NPV, using a

discount rate, k, greater than 0, will be 0.
D. If the IRR of a project is greater than the
discount rate, k, its PI will be less than 1 and its
NPV will be greater than 0.

The rate of interest offered
by the fixed deposit scheme
of a bank for 365 days and
above is 12%. What will be
the status of $20,000 after
two years if it is invested at
this point of time?
The new machine will cost
$75,250 plus $12,250 for
shipping and installation.
Net working capital will rise
by $10,000. The depreciable
basis of new machine is:
The new machine will cost
$75,250 plus $12,250 for
shipping and installation.
Net working capital will rise
by $10,000. The initial cash
outflow (ICO) is:
Basket Wonders has
determined that the after-tax
cash flows for the project
will be $10,000; $12,000;
$14,000; $12,000; and
$10,000, respectively, for

each of the Years 1 through
5. The initial cash outlay
will be $50,000. The
Payback Period (PBP) is:
Basket Wonders has
determined that the after-tax
cash flows for the project

A. $25,088
B. $28,032
C. $24,048
D. $22,056

A. $87,500
B. $97,500
C. $63,000
D. $85,250

A. $97,500
B. $63,000
C. $87,500
D. $85,250

A. 4.2 years
B. 3.2 years
C. 4.8 years
D. 3.8 years

A. 13.65%
B. 15.63%

C. 16.35%
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Ph ng ́n
D. 14.56%

A. -$20,694
B. $20,694
C. -$26,094
D. $26,094

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STT N i dung câu h i
will be $26,000; $28,000;
$30,000; $32,000; and
$30,000, respectively, for
each of the Years 1 through
5. The initial cash outlay
will be $100,000. The
Internal Rate of Return
(IRR) is:
Basket Wonders has
determined that the after-tax
cash flows for the project
will be $25,000; $27,000;

$30,000; $32,000; and
185. $24,000, respectively, for
each of the Years 1 through
5. The initial cash outlay
will be $120,000. The Net
Present Value (NPV) at 12%
is:
X has determined that the
before-tax cash flows for the
project will be $30,000;
$32,000; $32,000; $28,000,
respectively, for each of the
Years 1 through 4. The
initial cash outlay will be
$200,000. Final salvage
186.
value of asset is $5,000.
Assuming that the marginal
tax rate equals 25% (not on
salvage value of asset). The
Company expects to
depreciate its assets on a
straight-line basis. Net cash
flow for year 1 to 4:
X has determined that the
before-tax cash flows for the
project will be $15,000;
$16,000; $18,000; $13,000,
respectively, for each of the
Years 1 through 4. The

initial cash outlay will be
187. $120,000. Final salvage
value of asset is zero.
Assuming that the marginal
tax rate equals 28%. The
Company expects to
depreciate its assets on a
straight-line basis. Net cash
flow for year 1 to 4:
X has determined that the
before-tax cash flows for the
188. project will be $25,000;
$28,000; $30,000; $35,000,
respectively, for each of the

A. $72,500; $74,000; $74,000; $76,000
B. $22,500; $24,000; $24,000; $26,000
C. $80,000; $82,000; $82,000; $78,000
D. $72,500; $74,000; $74,000; $71,000

A. $40,800; $41,520; $42,960; $39,360
B. $22,500; $24,000; $24,000; $26,000
C. $80,000; $82,000; $82,000; $78,000
D. $72,500; $74,000; $74,000; $71,000

A. $93,000; $95,160; $96,600; $100,200
B. $122,500; $124,000; $124,000; $126,000
C. $80,000; $82,000; $82,000; $78,000
D. $72,500; $74,000; $74,000; $71,000
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