Corporate Finance Essay

п»їChapter apr

Long-Term Financial Planning and Growth

Multiple Choice Questions

1 . В Phil is working away at a financial arrange for the next 36 months. This time period is referred to as what kind of the following? В A. В financial range

B. В planning horizon

C. В planning plan

D. В short-run

E. В current financing period

2 . В Atlas Industries combines the smaller expense proposals by each detailed unit into a single project intended for planning uses. This process is known as which one with the following? В A. В conjoining

B. В aggregation

C. В conglomeration

D. В appropriation

E. В summation

3. В Which one of the subsequent terms is applied to the financial preparing method which usually uses the projected product sales level since the basis pertaining to determining within balance sheet and income statement account values? В A. В percentage of sales approach

B. В sales dilution technique

C. В sales reconciliation method

D. В common-size method

E. В trend technique

4. В Which one of the pursuing terms is defined as dividends paid expressed being a percentage of net income? В A. В dividend retention rate

B. В dividend yield

C. В dividend pay out ratio

M. В dividend section

E. В dividend section

a few. В Which one of many following correctly defines the retention percentage? В A. В one plus the dividend payment ratio

M. В addition to retained revenue divided by simply net income

C. В addition to retained income divided by dividends paid out

D. В net income less additions to stored earnings

E. В net income minus cash dividends

6th. В Which one of many following proportions identifies the quantity of assets a strong needs in order to generate $1 in product sales? В A. В current ratio

B. В equity multiplier

C. В retention rate

D. В capital intensity percentage

E. В payout ratio

several. В The inside growth rate of a organization is best identified as the: В A. В minimum growth charge achievable presuming a 100 % retention percentage. B. В minimum growth level achievable if the firm keeps a constant collateral multiplier. C. В maximum progress rate attainable excluding exterior financing of any kind. D. В maximum expansion rate attainable excluding any external collateral financing while keeping a constant debt-equity ratio. E. В maximum growth rate possible with endless debt loans. В

almost eight. В The sustainable growth rate of a organization is best described as the: В A. В minimum growth level achievable presuming a completely retention percentage. B. В minimum growth price achievable in case the firm maintains a constant value multiplier. C. В maximum growth rate possible excluding exterior financing of any kind. G. В maximum expansion rate attainable excluding any external value financing while maintaining a constant debt-equity ratio. Electronic. В maximum growth rate achievable with unrestricted debt auto financing. В

9. В You happen to be developing a economic plan for a company. Which in the following questions will be regarded as you develop this plan? I. How much net working capital will be needed?

II. Will extra fixed property be required?

III. Will payouts be paid to investors?

IV. Just how much new debts must be acquired? В

A. В I and IV only

B. В II and 3 only

C. В I, 3, and 4 only

G. В II, III, and IV only

Elizabeth. В I, 2, III, and IV

12. В Financial planning: В

A. В focuses entirely on the short-term outlook for any firm.

M. В is a procedure that organizations employ only when major becomes a firm's operations will be anticipated. C. В is a procedure that organizations undergo once every five years.

Deb. В considers multiple options and scenarios for two to five years. E. В provides minimal rewards for firms that are remarkably responsive to economical changes. В

11. В Financial planning accomplishes which from the following for any firm? I. determination of asset requirements

II. development of plans to contend with unpredicted events

III. establishment of priorities

IV. analysis of funding optionsВ

A. В I and III only

B. В II and IV just

C. В I, III, and IV only

D. В I, II, and III only

E. В I, II, III, and 4

12. В Which of the pursuing questions are appropriate to address through the financial organizing process? We....



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