Final Exam Financial Decision Making Comprehensive Test
Bank Final Exam 2026-2027 ||Most Recent Exam Actual
Complete Real Exam Questions And Correct Answers (Verified
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If total assets increase:
A. stockholders' equity must also increase.
B. net income must be positive.
C. the change must be offset by an equal increase in liabilities and
stockholders' equity.
D. net working capital must also increase.
E. an investment in fixed assets must have occurred
C. the change must be offset by an equal increase in liabilities and
stockholders' equity.
Assume you sell an asset today. Which of the following amounts are you
most likely to receive?
A. Carrying value
B. Book value
C. Market value
D. Historical value
E. Original cost minus accumulated depreciation
C. Market value
,Deferred taxes are a component of _ on a balance sheet.
A. current assets
B. long-term liabilities
C. current liabilities
D. stockholders' equity
E. fixed assets
B. long-term liabilities
The book value of a firm's assets:
A. represents the true market value of those assets according to GAAP.
B. is determined under Generally Accepted Accounting Principles
(GAAP) and is based on the cost of those assets.
C. is reported on the firm's income statement.
D. is always the best measure of the company's value to an investor.
E. is always higher than the replacement cost of the assets.
B. is determined under Generally Accepted Accounting Principles (GAAP)
and is based on the cost of those assets.
If a firm has long-term debt, net income must equal:
A. Operating income × (1 − Marginal tax rate).
B. Pretax income − Interest expense − Taxes.
C. EBIT − Taxes.
D. Dividends + Addition to retained earnings.
E. Taxes + Addition to retained earnings.
D. Dividends + Addition to retained earnings.
,Which one of the following statements is correct?
A. Only current taxes are included in the tax expense.
B. Earnings per share can be negative but dividends per share cannot.
C. Operating income is equal to operating revenue minus cost of goods sold.
D. The addition to retained earnings is equal to net income plus dividends.
E. Pretax income is equal to net income minus taxes.
B. Earnings per share can be negative but dividends per share cannot.
If the number of shares outstanding and total earnings both remain
constant, an increase in dividends per share will:
A. reduce net income.
B. reduce the addition to retained earnings.
C. increase total equity.
D. reduce the earnings per share.
E. increase total assets.
B. reduce the addition to retained earnings.
, According to Generally Accepted Accounting Principles (GAAP), the cost
of goods sold is:
A. matched with revenues.
B. recorded when payables are paid.
C. recorded when inventory is acquired.
D. matched with production levels.
E. expensed at the end of the production cycle.
A. matched with revenues.
Cash flow to stockholders is defined as:
A. cash dividends paid.
B. repurchases of equity less new equity sold minus cash dividends paid.
C. cash dividends paid plus repurchases of equity minus new equity
financing.
D. cash flow from financing less cash flow to creditors.
E. cash flow from assets plus cash flow to creditors.
C. cash dividends paid plus repurchases of equity minus new equity
financing.
_ ____ is the cash flow resulting from a firm's ongoing, normal business
activities.
A. Operating cash flow
B. Net capital spending
C. Additions to net working capital
D. Cash flow to investors
E. Free cash flow
A. Operating cash flow
Bank Final Exam 2026-2027 ||Most Recent Exam Actual
Complete Real Exam Questions And Correct Answers (Verified
Answers) Already Graded A+ |Guaranteed Success!! Newest
Exam | Just Released!!
If total assets increase:
A. stockholders' equity must also increase.
B. net income must be positive.
C. the change must be offset by an equal increase in liabilities and
stockholders' equity.
D. net working capital must also increase.
E. an investment in fixed assets must have occurred
C. the change must be offset by an equal increase in liabilities and
stockholders' equity.
Assume you sell an asset today. Which of the following amounts are you
most likely to receive?
A. Carrying value
B. Book value
C. Market value
D. Historical value
E. Original cost minus accumulated depreciation
C. Market value
,Deferred taxes are a component of _ on a balance sheet.
A. current assets
B. long-term liabilities
C. current liabilities
D. stockholders' equity
E. fixed assets
B. long-term liabilities
The book value of a firm's assets:
A. represents the true market value of those assets according to GAAP.
B. is determined under Generally Accepted Accounting Principles
(GAAP) and is based on the cost of those assets.
C. is reported on the firm's income statement.
D. is always the best measure of the company's value to an investor.
E. is always higher than the replacement cost of the assets.
B. is determined under Generally Accepted Accounting Principles (GAAP)
and is based on the cost of those assets.
If a firm has long-term debt, net income must equal:
A. Operating income × (1 − Marginal tax rate).
B. Pretax income − Interest expense − Taxes.
C. EBIT − Taxes.
D. Dividends + Addition to retained earnings.
E. Taxes + Addition to retained earnings.
D. Dividends + Addition to retained earnings.
,Which one of the following statements is correct?
A. Only current taxes are included in the tax expense.
B. Earnings per share can be negative but dividends per share cannot.
C. Operating income is equal to operating revenue minus cost of goods sold.
D. The addition to retained earnings is equal to net income plus dividends.
E. Pretax income is equal to net income minus taxes.
B. Earnings per share can be negative but dividends per share cannot.
If the number of shares outstanding and total earnings both remain
constant, an increase in dividends per share will:
A. reduce net income.
B. reduce the addition to retained earnings.
C. increase total equity.
D. reduce the earnings per share.
E. increase total assets.
B. reduce the addition to retained earnings.
, According to Generally Accepted Accounting Principles (GAAP), the cost
of goods sold is:
A. matched with revenues.
B. recorded when payables are paid.
C. recorded when inventory is acquired.
D. matched with production levels.
E. expensed at the end of the production cycle.
A. matched with revenues.
Cash flow to stockholders is defined as:
A. cash dividends paid.
B. repurchases of equity less new equity sold minus cash dividends paid.
C. cash dividends paid plus repurchases of equity minus new equity
financing.
D. cash flow from financing less cash flow to creditors.
E. cash flow from assets plus cash flow to creditors.
C. cash dividends paid plus repurchases of equity minus new equity
financing.
_ ____ is the cash flow resulting from a firm's ongoing, normal business
activities.
A. Operating cash flow
B. Net capital spending
C. Additions to net working capital
D. Cash flow to investors
E. Free cash flow
A. Operating cash flow
