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Which of the following statements is false?   A.   Mutual funds are pool investor funds to purchase financial instruments and thus reduce risks through diversification.   B.   Initial public offering (IPO) occurs when firm issues stock in the public market for the first time.   C.   The difference between current assets and non-current assets equals to working capital.   D.   Owner’s equity is the residual interest in assets that remains after subtracting an entity’s liabilities.

nay and creditors. appea risky b. It may increase interest rates on borrowing. c. It may cause the company to appear more stable, commanding a higher stock price for new stock listings. d. It may reduce interest rates on borrowing. Question:45 Before issuing a report on the compilation of financial statements of a nonpublic entity, the accountant should:a. Apply analytical procedures to selected financial data to discover any material misstatements. b. Corroborate at least a sample of the assertions management has embodied in the financial statements. c. Inquire of the client's personnel whether the financial statements omit substantially all disclosures. d. Read the financial statements to consider whether the financial statements are free from obvious material errors. Kaffen Company, a ski tuning, and repair shop, opened on November 1, 2013. The company carefully kept track of all its cash receipts and cash payments. The following information is available at the end of the ski…

If the stock market is efficient, why do companies manage their earnings? O To avoid violating debt covenants. O To receive bonuses based on reported earnings. O Because companies do not believe the Efficient Market Hypothesis. O All of the above.

Which of the following statements is NOT true?   A. Stock owners benefit from stock price increases   B. Higher stock prices allow companies access to more capital   C. Common stocks are not securities   D. Stock prices tend to be very volatile

Which one of the following statements is correct? A) Modigliani and Miller argued that dividend decisions are more important than capital structure decisions. Dividend policy is usually set by shareholders during the Annual General Meeting of a company. C) A share repurchase is an alternative to a dividend as a means for redistributing cash to the equity market. Shareholders typically view dividend increases as a signal of financial distress.

Which of the following would not be an appropriate reason for a firm to repurchase its stock:   As an investment if management believes the market has undervalued the stock price.   In order to have sufficient shares to cover employee stock programs.   Solely to boost Earnings Per Share.   Both A and B.

Which of the following actions would improve a firm's liquidity?   a.   Selling shares and reducing accounts payable.   b. Buying bonds.                                  c. Selling bonds and increasing cash. d. Both Selling bonds and increasing cash and Selling shares and reducing accounts payable.

In a strong-form efficient market, accounting announcements: will impact stock price only if it is related to cash flows will impact stock price if it involves new public information will imoact stock brice if it it affects a firms ability to borrow funds will no impact stock price

Which of the following is a difference between stocks and bonds? Select one: a. cash flows to bondholders are not known and not promised, cash flows to stockholders are known and promised b. companies issue stocks to grow the company and issue debt to pay bills c. required returns on debt are typically lower than required returns on equity d. dividends are legal obligations of the firm; coupons are not. Clear my choice

Which of the following statements is true? a. High liquidity means a company is short on cash and may be unable to pay its debts.b. When a company decides to go public through an IPO, it is typically targeting to sell its shares to only a handful of shareholders. c. If the company has a higher than expected extremely high profit this year, equity holders will benefit more than debt holders as debtholders are the residual claimers for the cash flows of the company.d. In the extreme case, the debt holders take legal ownership of the firm's assets through a process called bankruptcy.e. Equity holders expect to receive dividends and the firm is always legally obligated to pay them.

not use ai please

When additional shares of stock are issued, the earnings per share decreases (assuming no change in total earnings). Please explain how this occurs and what the impact on a firm’s decision to raise capital by equity, as oppose to debt.

Companies are more apt to choose repurchases over dividends if doing so will enable them to I. take advantage of a market undervaluation of their shares. II. maintain or increase the value of executive stock options. III. offset the dilution created by the exercise of executive stock options. IV. distribute revenue increases that are considered temporary or short-term in nature.

A firm is planning to issue bonds to make an equity repurchase to increase its stock price. It is basing its analysis on the fact that there will be fewer shares outstanding after the repurchases, and higher earnings per share.  Will the higher earnings per share always translate into a higher stock price? a. No b. Depends on stock price c. Yes d. Indifferent

[S1] When the entity issues a long-term debt instrument, it exposes itself to solvency risk. [S2] When the board of directors agreed to regularly issue stock dividends, it faces liquidity risk. *a. Both are true.b. Both are false.c. Only S2 is true.d. Only S1 is true.

Which of the following statements is true? Group of answer choices a. Dividend payments are attractive to executives who hold many executive stock options that were awarded to them by their firms b.Executives and other insiders benefit most by being able to tender their shares in an open market repurchase since they usually are privy to information that is not available to the general public                                                 c.Empirical research suggests that small, retail investors prefer stock repurchases to dividend payments d. a firm does not pay dividends, some institutional investors are prohibited from investing it the firmʹs equity

Which of the following is not one of the primary considerations management must make before a cash dividend is declared? O The availability of funds to pay the dividend. O The effect of inflation on the company and alternative uses of the cash to be paid for dividends. O The legal permissability of the dividend. O The tax impact on stockholders of the receipt of the dividends.

A firm’s preferred stock often sells at yields below its bonds because:a. Preferred stock generally carries a higher agency rating.b. Owners of preferred stock have a prior claim on the firm’s earnings.c. Owners of preferred stock have a prior claim on a firm’s assets in the event of liquidation.d. Corporations owning stock may exclude from income taxes most of the dividend income they receive.