Interest expenses incurred on debt financing are Blank______ when analyzing a proposed investment. Multiple choice question. ignored capitalized treated as cash outflows treated as cash inflows
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Interest expenses incurred on debt financing are Blank______ when analyzing a proposed investment.
ignored
capitalized
treated as cash outflows
treated as cash inflows
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- Interest expenses incurred on debt financing are Blank______ when analyzing a proposed investment. Multiple choice question. treated as cash inflows treated as cash outflows capitalized ignoredThe funds invested in current assets are termed as Select one: a. long term assets b. Short term loans c. None of the options d. Net Working Capital e. Short-term liabilitiesThe funds invested in current assets are termed as Select one: a. None of the options b. Short-term liabilities c. Short term loans d. Gross Working Capital e. long term assets
- Note payments reduce cash and are related to long-term debt. Do these facts automatically lead to their inclusion as elements of the financing section of the statement of cash flows? Explain.Classification of Changes in Short-Term Financing. The statement of cashflows classifies changes in accounts payable as an operating activity but classifies changes in short-term borrowing as a financing activity. Explain this apparent paradox. Please explain without copying from another source.Use IFRS 9 to determine how to subsequently measure the following financial assets. Three choices of measurement basis are amortized cost, fair value through other comprehensive income, and fair value through profit or loss. Provide justification for your choice. Long-term loans that are held for collecting contractual cash flows till their maturities, but may be subsequently sold if the loans’ credit risk substantially increases. Investments in bonds that are held for collecting contractual cash flows, and may be subsequently sold to re-invest the cash in financial assets with a higher return. Subprime (high risk) mortgage loans that were originated by a mortgage-broker firm that always sell these loans to banks right after their origination. Forward contracts that an EU bank purchased to hedge the exposure to changes in fair value of US$-denominated loans. Investment in bonds that are convertible into common stock of the bond issuer. Investment in bonds that pay a variable market…
- Which of the following statements is incorrect regarding the investing activities section of the statement of cash flows? Multiple Choice Investing activities deal with long-term liabilities (debt) and equity accounts. Increases in long-term asset balances suggest cash outflows to purchase assets. Decreases in long-term asset balances suggest cash inflows from selling assets. Investing activities involve cash purchases and cash disposals of long-term assets. XWhich of the following returns is consistent with contractual cash flows that are SPPI? Return for passage of time. Return for the risk that one party to a financial instrument will cause a financial loss for the other party by failing to discharge an obligation. Return for the risk that an entity will encounter difficulty in meeting obligations associated with financial liabilities that are settled by delivering cash or another financial asset. Return for amounts to cover expenses and a profit margin. Group of answer choices I, II and III only I and IV only I, II, III and IV II and III onlyplease answer the following question
- Decreasing the amount of liquid assets held for the purpose of meeting loan demands and deposit withdrawals and increasing the usage of deposit and nondeposit sources of funds paying market rates of interest is known as: a. leverage adjustment b. liability management c. liquidity management d. liquidity adjustmentMultiple choice: 1. Too large an investment in fixed capital may leave too little money for A. Working capital B. Settlements C. Compliance D. Requirements 2. Circulating capital A. Cash on hand B. Working capital C. Net balances D. Cash disbursementConsider the “Cash Flow Available for Debt Repayment” metric in the Cash Flow Projections and Debt Schedule of an LBO Model. The statements below list similarities and differences between this metric and the “Free Cash Flow” metric, as it is normally defined and used in 3-statement models.Which of these statements list(s) a similarity or difference that is INCORRECT?a. Both figures deduct the Net Interest Expense but exclude Optional Principal Repayments on New Debt used to fund the LBO.b. Free Cash Flow is a component of Cash Flow Available for Debt Repayment, along with an addition for the Beginning Cash, a deduction for the Minimum Cash, and other possible adjustments.c. Free Cash Flow is capital structure-neutral, but Cash Flow Available for Debt Repayment is not because it changes throughout the LBO holding period as the company repays its Debt balance.d. The Change in Debt each year should equal the Cash Flow Available for Debt Repayment each year, but it will never equal the…