FIN 571 Final Exam Latest UOP Study Materials

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FIN 571 Final Exam

Multiple Choice Question 51
You are provided the following working capital information for the Ridge Company:
Ridge Company
Account
$

Inventory
$12,890
Accounts receivable
12,800
Accounts payable
12,670

Net sales
$124,589
Cost of goods sold
99,630

Cash conversion cycle: What is the cash conversion cycle for Ridge Company?
38.3 days
46.4 days
83.5 days
129.9 days
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Multiple Choice Question 58
The cash conversion cycle begins when the firm uses its cash to purchase raw materials and ends when the firm collects cash payments on its credit sales. estimates how long it takes on average for the firm to collect its outstanding accounts receivable balance.
shows
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If the firm's growth in dividends is expected to remain at a flat 3 percent forever, then what is the cost of equity capital for Gangland if the price of its common shares is currently $17.50?
15.36%
12.00%
14.65%
15.00%
Multiple Choice Question 68
How 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?
30%
50%
70%
33%
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Multiple Choice Question 60
What decision criteria should managers use in selecting projects when there is not enough capital to invest in all available positive NPV projects?
The profitability index.
The modified internal rate of return.
The internal rate of return.
The discounted payback.
Multiple Choice Question 88
Capital rationing. TuleTime 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?
0.11
1.90
1.11
0.90
Multiple Choice Question 79
PV of dividends: Next year Jenkins Traders will pay a dividend of $3.00. It expects to increase its dividend by

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