HBX CORE PRACTICE SCRIPT 2026 TESTED
SOLUTIONS GRADED A+
⩥ Asset/Expense Accounts.
Answer: Asset and expense accounts increase with debit and decrease
with credit.
⩥ Income Statement.
Answer: Shows a company's financial performance, because it shows the
accumulation of all nominal accounts over a period of time.
⩥ Gross Profit.
Answer: Sales Revenue minus COGS.
⩥ Accounts Payable Turnover.
Answer: Credit Purchases/Average Accounts Payable Balance.
⩥ Internal Rate of Return (IRR).
Answer: The discount rate that sets the net present value (NPV) of a
project equal to zero. The IRR allows us to find the percentage rate that
would be earned for a given set of cash flows.
⩥ Gross Profit Margin Calculation.
, Answer: Gross Profit/Revenue =Gross Profit Margin
⩥ Leverage Ratio Calculation.
Answer: Average Total Assets/Average Equity.
Suggested Formula =Average (B11,D5)/Average (Sum(B16:B18),D8).
⩥ Present Value Calculation.
Answer: It is calculated by multiplying the annual payment by the
present value of an annuity factor.
$18,000*6.71008=$120,781
⩥ Return on Equity (ROE).
Answer: The return that a business generates during a period on equity
invested in the business by the owners of the business.
Measured in DuPont Framework.
⩥ Return on Investment (ROI).
Answer: The return or profit received as a result of investing funds.
SOLUTIONS GRADED A+
⩥ Asset/Expense Accounts.
Answer: Asset and expense accounts increase with debit and decrease
with credit.
⩥ Income Statement.
Answer: Shows a company's financial performance, because it shows the
accumulation of all nominal accounts over a period of time.
⩥ Gross Profit.
Answer: Sales Revenue minus COGS.
⩥ Accounts Payable Turnover.
Answer: Credit Purchases/Average Accounts Payable Balance.
⩥ Internal Rate of Return (IRR).
Answer: The discount rate that sets the net present value (NPV) of a
project equal to zero. The IRR allows us to find the percentage rate that
would be earned for a given set of cash flows.
⩥ Gross Profit Margin Calculation.
, Answer: Gross Profit/Revenue =Gross Profit Margin
⩥ Leverage Ratio Calculation.
Answer: Average Total Assets/Average Equity.
Suggested Formula =Average (B11,D5)/Average (Sum(B16:B18),D8).
⩥ Present Value Calculation.
Answer: It is calculated by multiplying the annual payment by the
present value of an annuity factor.
$18,000*6.71008=$120,781
⩥ Return on Equity (ROE).
Answer: The return that a business generates during a period on equity
invested in the business by the owners of the business.
Measured in DuPont Framework.
⩥ Return on Investment (ROI).
Answer: The return or profit received as a result of investing funds.
