By use of examples, distinguish between: a. Debt and equity securities. (5 marks)b. Primary and secondary markets. (5 marks)c. Money markets and capital markets. (5 marks)d. Aggressive and conservative working capital management. (5 marks) .

(a. investment banking   b. insurance firms  c. commercial banking d. mutual fund  e. pension fund) is a transformer of short term liabilities to long term assets.       e     d     b     c     a

1. Differentiate stocks from bonds; and stockholders from bondholders. 2. Explain the components of capital (retained earnings, bonds, preferred equity and common equity) relative to weighted average cost of capital. 3. What are the factors affecting cost of debt? Define or explain each of them.

1. More than one measurement bases apply to investments in debt securities and investment in equity under PFRS 9. What are these measurement bases?2. Identify critical questions to be asked in applying PFRS 9 in the measurement of financial assets.3. How would you distinguish an equity instrument from a debt instrument?

In what section of the balance sheet should the following items appear, and what balance sheet terminology would you use? a.    Treasury stock (recorded at cost). b.    Checking account at bank. c.    Land (held as an investment). d.    Sinking fund. e.    Unamortized premium on bonds payable. f.    Copyrights. g.    Pension fund assets. h.    Premium on common stock. i.    Long-term investments (pledged against bank loans payable).

Please answer in CAPITAL LETTER IF IT IS AN INFLOW(I )OR AN OUTFLOW (O)COLUMN 1 , AND COLUMN 2 , IF IT CORRESPONDS TO OPERATINGCASHFLOW(OC),INVESTMENT ACTIVITY CASHFLOW(IC), FINANCING ACTIVITY CASHFLOW ( FC)Example: Reduce marketable securities : I OC ( "I" or "O") AND ("OC", "IC" o "FC" )Activity INFLOW " I" orOutflow "O"              OPERATINGCASHFLOW(OC), INVESTMENTACTIVITY CASHFLOW(IC), FINANCINGACTIVITY CASHFLOW ( FC) 1. Purchase of treasurystock2. Purchase of availablefor sale investment 3. Sale of equipment at aloss 4. Increase in accountspayable 5. Retirement of bonds 6. Issuance of bonds 7. Decrease in accountspayable 8. Increase in inventory9. Loan from bank bysigning a note 10. Increase in accountsreceivable 11. Purchase of equipmentby issuing a note 12. Purchase of land andbuilding. 13. Decrease in accountsreceivable.14. Payment of dividends. 15.…

Which of the following ratios is most useful in evaluating liquidity? ed d out of g ion • A. Return on assets. O B. Debt to equity ratio. C. Return on equity/capital O D. Current ratio.

Debt to Total Assets Ratio can be improved by: A. Borrowing More, B. Issue of Debentures, C. Issue of Equity Shares, D. Redemption of Debt.

The two main approaches to equity analysis are the relative valuation models and…a. The discounted earnings models.b. The depreciated cash-flow models.c. The discounted cash-flow models.d. The depreciated capital models.

Which one of the following is an internal characteristic that can affect the value of an investment? O a. Political events. O b. Taxation policy. Oc Capital structure. O d. Inflation. (Chapter.2) ot dunr