WGU C214 Final Exam Questions and answers;Questions
and comments provided by class mentors who mentioned
these topics would be covered on final exam 2023
Coupon Rate
The interest rate that a company promises to pay on bonds
Market Rate
The interest rate on other comparable bonds
Par Value
The amount payable on maturity of the bond
Market rate
Same as YTM - Yield to Maturity
Gordon Growth Model
Assumes stable growth rates and does not incorporate risk
CAPM Model
Allows to determine expected return on stocks and incorporates risk
How do public companies maximize shareholder value?
By maximizing Earnings Per Share
How do private companies maximize shareholder value?
By keeping control within the company
Positive credit rating has what effect on capital?
Lowers cost of capital
What is cash flow from operating activities?
It is cash flow generated for sale of products and services
What is the formula for retained earnings?
Ending retained earnings=Beginning retained earnings + Net Income - Dividends
Is depreciation and salvage value on an asset precise or is it an estimate?
It is an estimate
What is an example of accounting difference
Companies using different accounting methods
What is an example of a timing difference?
Companies using different fiscal years
Do stock holders or bond holders have voting rights?
Stock holders have voting rights
What factors are considered for the initial outlay of a new investment?
Purchase price of new equipment, shipping costs, and investment in working capital
What is the risk associated with debt financing?
Too much debt can lead to bankruptcy
What are inventory related costs?
Product costs, storage costs, and opportunity costs
What statements are required to be filed with the SEC
Annual audited financial statements
What are the issues with understanding foreign financial statements?
Foreign financial statements use international financial reporting standards and they are
different from US accounting standards
and comments provided by class mentors who mentioned
these topics would be covered on final exam 2023
Coupon Rate
The interest rate that a company promises to pay on bonds
Market Rate
The interest rate on other comparable bonds
Par Value
The amount payable on maturity of the bond
Market rate
Same as YTM - Yield to Maturity
Gordon Growth Model
Assumes stable growth rates and does not incorporate risk
CAPM Model
Allows to determine expected return on stocks and incorporates risk
How do public companies maximize shareholder value?
By maximizing Earnings Per Share
How do private companies maximize shareholder value?
By keeping control within the company
Positive credit rating has what effect on capital?
Lowers cost of capital
What is cash flow from operating activities?
It is cash flow generated for sale of products and services
What is the formula for retained earnings?
Ending retained earnings=Beginning retained earnings + Net Income - Dividends
Is depreciation and salvage value on an asset precise or is it an estimate?
It is an estimate
What is an example of accounting difference
Companies using different accounting methods
What is an example of a timing difference?
Companies using different fiscal years
Do stock holders or bond holders have voting rights?
Stock holders have voting rights
What factors are considered for the initial outlay of a new investment?
Purchase price of new equipment, shipping costs, and investment in working capital
What is the risk associated with debt financing?
Too much debt can lead to bankruptcy
What are inventory related costs?
Product costs, storage costs, and opportunity costs
What statements are required to be filed with the SEC
Annual audited financial statements
What are the issues with understanding foreign financial statements?
Foreign financial statements use international financial reporting standards and they are
different from US accounting standards
