BUSN 379 Midterm Exam Solutionhttp://homeworkyahoo.com/downloads/busn-379-midterm-exam-solution/ To Buy this tutorial Copy & paste above link in your BrowerBUSN 379 Midterm Exam Solution 1. What is the goal of financial management for a sole proprietorship? 2. Working capital management includes which of the following? 3. Market value reflects which of the following: 4. Which of the following is true regarding income statements? 5. Telemarket Inc has sales of !"#$%&&& They paid !'(%&&& in interest during the year and depreciation was !)*%&&& +dministrative costs were !,&&%&&& and other costs were !,"&%&&& +ssuming a ta- rate of ($ percent% what is Telemarket.s ta-able income? 6. /ome 0est /ardware had !(,$%&&& in ta-able income last year 1sing the ta- rates provided in Table #(% what is the appro-imate average ta- rate? 7. 2i33a + had earnings after ta-es of !(*&%&&& in the year #&&4 and (&&%&&& shares outstanding In year #&&*% earnings after ta-es increased by #& percent to !'"4%&&& and #$%&&& new shares were issued for a total of (#$%&&& shares What is the 526 figure for #&&4? 8. The income statement reflects: 9. 7reen 8eaf 9ursery has 50IT of !#$&%&&&% interest of !(&%&&&% ta-es of !$&%&&&% and depreciation of !4&%&&& What is the company.s operating cash flow? 1. Mark deposited !,%&&& today% in an account that pays eight percent interest% compounded semi:annually Which one of the following statements is correct concerning this investment? 11. Mr 6mith will receive !4%$&& a year for the ne-t ,' years from a contract If the interest rate on this investment is eight percent% what is the appro-imate current value of these future payments? 12. ;5< 5ngineering ac=uired an additional business unit for !(,&%&&& The seller agreed to accept annual paymentsof !")%&&& at an interest rate of "$ percent /ow many years will it take ;5< 5ngineering to pay for this purchase? 13. >ine ?ak Woodworks is considering a pro@ect that has cash flows of !"%&&&% !'%&&&% and !(%&&& for the ne-t threeyears If the appropriate discount rate of this pro@ect is ,& percent% which of the following statements is false? 14. Aou are considering two investments Investment I% is in a software company and Investment II% is an engineering company The investments offer the following cash flows:Aear 6oftware Company 5ngineering Company, !$%&&& !,$%&& !(%&&& !4%&&&( !'%&&& !*%&&&' !(%"&& !,,%&&&If the appropriate discount rate is ,& percent% what is the appro-imate present value of the 6oftware Company investment? 15. 9orth 0ank offers you an +2B of ,(,) percent compounded monthly% and 6outh 0ank offers you an effective rateof ,()$ percent on a business loan Which bank should you choose and why? 16. Which one of the following will increase the future value of a lump sum invested today? 17. Which one of the following is an e-ample of an annuity% but not a perpetuity? 18. >anta Cola has !,%&&& par value bonds outstanding at ,# percent interest The bonds mature in #$ years What is the current price of the bond if the ATM is ,( percent? +ssume annual payments 19. + bond.s debenture will include which of the following? 2. 0onds issued by 0lue 6ky +irlines have a face value of !,%&&& and currently sell for !4$& The annual coupon payments are !4& If the bonds have ,& years until maturity% what is the appro-imate ATM of the bonds? 21. 0ean Coffee issued preferred stock many years ago It carries a dividend of !4 per share% fi-ed +s time has passed% yields have decreased from the original eight percent Cat the time of issuanceD to si- percent What was the current price of the stock? /int: Aield is the same as re=uired rate of return 22. Intelligence Besearch% Inc will pay a common stock dividend of !,"& at the end of the year The re=uired rate of return by common stockholders is ,( percent The firm has a constant growth rate of )$ percent What is the current price of the stock? 23. Boyal 5lectric paid a !' dividend last year The dividend is e-pected to grow at a constant rate of si- percent overthe ne-t four years Common stockholders re=uire a ,( percent return What are the values of the dividends for years,% # and (% respectively? 24. Which of the following is true regarding the primary market? 25. The smallest firms listed on 9+6