Download Finance Exam Questions & Answers: Financial Statements, Bonds, and Stock and more Exams Business Administration in PDF only on Docsity!
Peregrine Exam (Latest 2024/ 2025
Update) 220 Questions and Verified
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Balance Sheet Analysis - ANSWER Analysis of assets, liabilities, and equity Annually or quarterly Helpful for investors, bankers and brokers Compliance in Accounting - ANSWER Sarbanes act was created in 2002 to protect shareholders What are dividends? - ANSWER a sum of money paid regularly by a company to its shareholders out of its profits _ can be allocated as fixed amount per share - ANSWER Dividends Dividends - ANSWER can only be received one or more regular payment stream Cash dividend - ANSWER paid out of currency of the company
Are usually taxable stock dividend - ANSWER Paid out in form of stock Property - ANSWER paid out in form of asset Interim - ANSWER made before a companies annual general meeting and final financial statement Common stock - ANSWER allows owners to vote at shareholder meetings and receive dividends preffered stock - ANSWER stock that gives stockholders preference in earnings and other rights Growth stock - ANSWER earnings grow faster than market average Dividends rarely paid Investors buy them Startup technology company likely has them
Which bond is issued by companies? - ANSWER Corporate bonds Companies issue these rather than bank loans - ANSWER Corporate bonds Corporate bonds - ANSWER offer lower interest rates municipal bonds are - ANSWER issued by states and municipalities T/F Municipal bonds are tax free coupon income - ANSWER T Government Bonds - ANSWER Certificates sold by the government to raise money with the guarantee that the purchaser will be paid back later (with interest) Agency Bonds - ANSWER bonds issued by US government agencies Which coupon is given at discount to par value? - ANSWER zero-coupon
zero coupon bond - ANSWER generate a return when bond holder is paid in full face when bond matures convertible bonds - ANSWER Bonds that can be converted into common stock at the bondholder's option callable bonds - ANSWER bonds that the issuing company can redeem (buy back) at a stated dollar amount prior to maturity Puttable bonds - ANSWER Are able to be sell back to company before it matures Common types of financial statements - ANSWER balance sheet income statement cash flow Balance sheets deal with - ANSWER assets liabilities shareholder equity Income statements deal with - ANSWER operating, depreciation, net income, earnings per share
simple interest - ANSWER interest paid on the principal alone Simple Interest Formula - ANSWER rate x principle x number of days= simple interest compound interest - ANSWER interest earned on both the principal amount and any interest already earned Compound Interest Formula - ANSWER A=P(1+r/n)^nt taxable income - ANSWER income on which tax must be paid; total income minus exemptions and deductions tax exempt - ANSWER not subject to tax by federal or state governments Initial loan - ANSWER debt on cash account and credit either short term debt or long term interest payments - ANSWER A payment that repays interest on a loan, bond etc, rather than paying off any of the original amount
mixed debt - ANSWER includes both interest expense and loan repayment final debt - ANSWER last payment of debt Journal Entry - ANSWER an accounting method for expressing the effects of a transaction on accounts in a debits-equal-credits format debt and credit must be equal adjusting - ANSWER The process of calculating the latest up-to-date balance of each account at the end of an accounting period. compound - ANSWER more than two lines payroll number of deductions tax liabilities reversing - ANSWER made at the beginning of the period wage accrual is replaced with actual payroll expenditure
Operating Cycle - ANSWER The average time required to purchase inventory, sell it on account, and then collect cash from customers— that is, go from cash to cash. Day Sales in Inventory - ANSWER 365/inventory turnover Average Collection Period - ANSWER 365/accounts receivable turnover ratio DEALS - ANSWER Dividends, expenses, assets and losses GIRLS - ANSWER Gains, income, revenues, liabilities and stockholders' equity. SOX Act - ANSWER Requires managers and auditors of public companies to document and certify the system of internal control Principle of SOX act - ANSWER Corporate responsibility, increased criminal punishment, accounting regulation, new protections annual report - ANSWER a yearly statement of the financial condition, progress, and expectations of an organization
Some annual reports are due every _____ - ANSWER year Some annual reports are due every ______years - ANSWER 2 Some annual reports are due every_______years - ANSWER 10 quarterly report - ANSWER Brief unaudited report for quarter normally containing summary income statement and balance sheet publicly traded companies - ANSWER must file their quarterly reports on Form 10-Q with the SEC Quarterly reports must include - ANSWER Executive summary, highlights, future goals and objectives Cost Approach - ANSWER The process of estimating the value of a property by adding to the estimated land value the appraiser's estimate of the reproduction or replacement cost of the building, less depreciation.
Income statement is also called - ANSWER profit and loss statement Asset Turnover - ANSWER A measure of how efficiently a company uses its assets to generate sales; calculated as net sales divided by average total assets. Asset Turnover Ratio - ANSWER net sales/average total assets total sales - ANSWER Annual sales total Beginning assets - ANSWER assets at the start of the year Ending assets - ANSWER assets at the end of the year Wage Payable - ANSWER liability Interest Payable - ANSWER liability Dividends Payable - ANSWER liability
Noncurrent Liabilities - ANSWER obligations that a company does not expect to pay within one year Warranty Liability - ANSWER the liability of someone who receives payment on an instrument Contingent Liability - ANSWER an existing uncertain situation that might result in a loss deffered - ANSWER put off until a future time Post-employment benefits - ANSWER Benefits, other than pensions, that a state or local government employee receives as part of their package of retirement benefits. Retiree medical insurance is most signficant offering, but also life insurance, 401K, Annuity. unamortized investment tax credit - ANSWER This represents the net between an asset's historical cost and the amount that has already been depreciated. Unearned Revenue - ANSWER liability
