Chapter 6, Problem 5DQ

Fin. Prob solve

Solve qnn

Calculate dividends qn

Mr dev.

Which of the following is not true about goodwill?* Goodwill needs to be evaluated for impairment yearly Goodwill is treated as a tangible asset in accounting Goodwill is a result of purchasing a company for a price higher than the fair market value of the target company's net assets Goodwill can be comprised of things such as good reputation, loyal client base, and brand recognition

What is working capital?* Equity Capital + Retained Earnings Equity Capital - Total Liabilities Total Assets - Total Liabilities Current Assets - Current Liabilities

Which of the following is not a financing activity?* Repayment of long-term debt Issuance of equity Investments in businesses Payment of dividends

The correct order of capital stack from the most to least secured is* Equity > Subordinated debt > Senior debt Suborindated debt > Senior debt > Equity Senior debt > Subordinated debt > Equity Senior debt > Equity > Subordinated debt

16. ____ underwriting commitment is when the underwriter agrees to buy the entire issue and assume full financial responsibility for any unsold shares.* Best efforts Firm commitment All-or-none Full-purchase