FIN 571 Final Exam Latest UOP Study Materials

1
FIN 571 Final Exam Question Answers

• By www.TransWebeTutors.com

Copyright. All Right Reserved By
www.TransWebeTutors.com
2
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  Find the
final exam answers here FIN 571 Final Exam
Copyright. All Right Reserved By
www.TransWebeTutors.com
3
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 how long the firm keeps
its inventory before selling it. begins when the
firm invests cash to purchase the raw materials
that would be used to produce the goods that the
firm manufactures. Multiple Choice Question
30 Payout and retention ratio Drekker, Inc., has
revenues of 312,766, costs of 220,222, interest
payment of 31,477, and a tax rate of 34 percent.
It paid dividends of 34,125 to shareholders.
Find the firm's dividend payout ratio and
retention ratio. 85, 15 55, 45 15, 85 45,
55 Download now FIN 571 Entire Course
Copyright. All Right Reserved By
www.TransWebeTutors.com
4
Multiple Choice Question 75 Firms that achieve
higher growth rates without seeking external
financing are highly leveraged. none of
these. have less equity and/or are able to
generate high net income leading to a high
ROE. have a low plowback ratio. Multiple Choice
Question 67 The strategic plan does NOT
identify working capital strategies. the lines of
business a firm will compete in. major areas of
investment in real assets. future mergers,
alliances, and divestitures. Multiple Choice
Question 41 Which of the following does
maximizing shareholder wealth not usually account
for? The timing of cash flows. Amount of Cash
flows. Risk. Government regulation.
Copyright. All Right Reserved By
www.TransWebeTutors.com
5
Multiple Choice Question 80 Which of the
following cannot be engaged in managing the
business? a sole proprietor a general
partner none of these a limited partner Final
Exam Answers just a click away FIN 571 Final Exam
Question Answer   Multiple Choice Question
46 External 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? 30.3 25.1 27.3 32.9
Copyright. All Right Reserved By
www.TransWebeTutors.com
6
Multiple Choice Question 86 Multiple Analysis
Turnbull 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 1,315
million 453.6 million 1,334 million Multiple
Choice Question 69 MM 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 to 60 percent equity and use the debt
proceeds to pay a special dividend to
shareholders, how much debt should they
issue? 375 600 225 321 
Copyright. All Right Reserved By
www.TransWebeTutors.com
7
Multiple Choice Question 54 A firm's capital
structure is the mix of financial securities used
to finance its activities and can include all of
the following except stock. bonds. equity
options. preferred stock. Multiple Choice
Question 32 If a company's weighted average cost
of capital is less than the required return on
equity, then the firm Is perceived to be
safe Has debt in its capital structure Must have
preferred stock in its capital structure Is
financed with more than 50 debt Final Exam
Answers just a click away FIN 571 Final Exam
Answer
Copyright. All Right Reserved By
www.TransWebeTutors.com
8
Multiple Choice Question 85 The cost of equity
Gangland Water Guns, Inc., is expected to pay a
dividend of 2.10 one year from today. 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 Complete paper here FIN 571
Knowledge Check   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.
Copyright. All Right Reserved By
www.TransWebeTutors.com
9
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 0.25 in each
of the following three years. If their required
rate of return is 14 percent, what is the present
value of their dividends over the next four
years? 13.50 11.63 9.72 12.50
Copyright. All Right Reserved By
www.TransWebeTutors.com
10
Multiple Choice Question 57 Bond 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.) 1,014 1,066 923 972  Want to check
out the complete Final Exam Paper..?? Visit FIN
571 Final Exam Question   Multiple Choice
Question 62 Serox 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.) 16 32 12 40 
Copyright. All Right Reserved By
www.TransWebeTutors.com
11
Multiple Choice Question 57 Future value of an
annuity Jayadev Athreya has started on his first
job. He plans to start saving for retirement
early. 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? (Round to
the nearest dollar.) 1,745,600 3,594,524 5,233,
442 2,667,904 Multiple Choice Question 72 PV of
multiple cash flows Ajax Corp. is expecting the
following cash flows79,000, 112,000, 164,000,
84,000, and 242,000over 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.) 480,906 414,322
477,235 429,560
Copyright. All Right Reserved By
www.TransWebeTutors.com
12
Multiple Choice Question 64 PV of multiple cash
flows Ferris, Inc., has borrowed from their bank
at a rate of 8 percent and will repay the loan
with interest over the next five years. Their
scheduled payments, starting at the end of the
year are as follows450,000, 560,000, 750,000,
875,000, and 1,000,000. What is the present
value of these payments? (Round to the nearest
dollar.) 2,431,224 2,815,885 2,735,200 2,615,4
32  Download for answers FIN 571 Final Exam
Question and Answers Multiple Choice Question
62 Present value Jack 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 16,670 
Copyright. All Right Reserved By
www.TransWebeTutors.com
13
Multiple Choice Question 67 Which of the
following is not a method of benchmarking? Condu
ct an industry group analysis. Evaluating a
single firms performance over time.(112) Utilize
the DuPont system to analyze a firms
performance. Identify a group of firms that
compete with the company being analyzed.  Multipl
e Choice Question 84 Leverage ratio Your firm
has an equity multiplier of 2.47. What is its
debt-to-equity ratio? 1.74 0.60 1.47(95) 0  Multi
ple Choice Question 70 Efficiency ratio Gateway
Corp. has an inventory turnover ratio of 5.6.
What is the firm's days's sales in
inventory? 65.2 days 64.3 days 61.7 days 57.9
days To download the complete answer check FIN 571
Copyright. All Right Reserved By
www.TransWebeTutors.com
14
Multiple Choice Question 63 Which of the
following presents a summary of the changes in a
firms balance sheet from the beginning of an
accounting period to the end of that accounting
period? The statement of retained earnings. The
statement of working capital. The statement of
cash flows.(66) The statement of net
worth. Multiple Choice Question 78 Teakap, 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? 2,123,612 803,010 1,844,022 2,303,010 
Multiple Choice Question 57 Which of the
following is a principal within the agency
relationship? the CEO of the firm a
shareholder the board of directors a company
engineer 
Copyright. All Right Reserved By
www.TransWebeTutors.com
15
Multiple Choice Question 59 Which of the
following is considered a hybrid organizational
form? limited liability partnership partnership co
rporation sole proprietorship   About
Author   This article covers the topic for the
University Of Phoenix FIN 571 Final Exam. The
author is working in the field of education from
last 5 years. This article covers the basic
of FIN 571 Final Exam Assignment from UOP.
    Want to check other classes..?? Visit
www.transwebetutors.com
Copyright. All Right Reserved By
www.TransWebeTutors.com