6. In order to generate cash, Company A securitized its accounts receivable through a special purpose entity. Company B pledge its accounts receivable to a local bank in order to secure a short-term loan. Assuming Company A and Company B are identical in all other respects, which company has higher operating cash flow and which company has higher financing cash flow? higher operating cash flow higher financing cash flow ① Company A Company A ② Company A Company B ③ Company B Company B
9. An analyst needs to compare the financial statements of Firm A and Firm B. Which of the following differences in the two firms' financial reporting is least likely to acquire the analyst to make an adjustment? Firm A Firm B ① straight-line depreciation accelerate depreciation ② direct method cash flows indirect method cash flows ③ IFRS financial reporting U.S.A. GAAP financial reporting
10. Are held-for-trading securities and influential securities reported on the balance sheet at fair value? held-for-trading securities influential securities ① yes no ② no yes ③ yes yes
11. Corrisson Company is in the third year of a 4-year contract to build a new airdrome. Due to a labor strike, Corrisson is unable to reliably estimate the total cost of the project. Can Corrisson recognize revenue in the first year of the project according to U.S. accounting standards and international accounting standards? U.S. accounting standards international accounting standards ① yes no ② no yes ③ yes yes
12. According to the International Accounting Standards Board, where should a firm report interest received and dividends received in the cash flow statement?
13. At the end of the year, a firm reported LIFO inventory of $30000 and cost of goods sold of $80000. If the LIFO reserve was $8000 at the beginning of the year and $20000 at the end of the year, how much was FIFO COGS?
14. A large corporation accepts a project which generates no revenue and has a negative net present value. The project is most likely classified in which of the following categories?
16. A company recently opened a limestone quarry at a location outside its traditional service area. Because limestone is a major ingredient in concrete, if the quarry is successful the company plans to build a ready-mix concrete plant is best described as:
28. Which of the following statements about NPV and IRR is least accurate?
A.The IRR is the discount rate that equates the present value of the cash inflows with the present value of outflows.
B.For mutually exclusive projects, if the NPV method and the IRR method give conflicting rankings, the analyst should use the IRR to select the project.
C.The NPV method assumes that cash flows will be reinvested at the cost of capital, while IRR method assume that cash flows are reinvested at the IRR.
29. An analyst gathered the following data about a company: capital structure required rate of return 40% debt 15% 10% preferred stock 13% 50% common stock 10% Assuming a 30% tax rate, what after-tax rate of return must the company earn on its investments?
A.7.3%
B.10.5%
C.13.4%
A B C
B
[解析] 厂商的资金成本不仅由债务及权益的成本决定,而且还由厂商资本组合中债务及权益(包括普通股权益和优先股权益)的比例决定,这种关系在厂商的加权平均资金成本(Weighted Average Cost of Capital,WACC)中得到体现。WACC是以各种资本占全部资本的比重为权数,对各种资本的成本进行加权平均计算出来的。WACC本质上是厂商为其资产融资的成本,其计算公式为: WACC=kd(1-t)wd+kpwp+kcwc 式中,kd表示税前债务资金成本,t表示厂商所得税税率,wd表示债务在厂商资本结构中所占的百分比;kp表示优先股资金成本,wp表示优先股在厂商资本结构中所占的百分比;kc表示普通股资金成本,wc表示普通股在厂商资本结构中所占的百分比。 在本题中,WACC=kd(1-t)wd+kpwp+kcwc =15%×(1-30%)×40%+13%×10%+10%×50% =10.5%
30. A company has $30 million in debt outstanding with coupon rate of 15%. Currently the yield to maturity (YTM) on these bonds is 12%. If the firm's tax rate is 30%, what is the company's after-tax cost of debt?
31. A company's $100, 7% preferred stock is currently selling for $124. What is the company's cost of preferred stock?
A.5.6%
B.6.8%
C.8.3%
A B C
A
[解析] 优先股资金成本(kp)计算公式为:
式中,Dp表示优先股股息,P表示优先股的价格。 在本题中,优先股资金成本
32. An analyst gathered the following data about a company: ●The company stock beta is 1.8. ●Risk-free rate is 7%. ●Market risk premium is 5%. The company's cost of equity using capital asset pricing model (CAPM) approach is:
33. The expected dividend is $3 for a share of stock priced at 35. What is the cost of equity if the long-term growth in dividends is projected to be 10%?
34. Ellison is an analyst of KM&G, a major U. S. based investment bank. Ellison is considering opening new stores in Brazil and wants to estimate its cost of equity capital for this investment. Ellison has found that: ●The yield on a Brazilian government 10-year U.S. dollar-denominated bond is 8%. ●A 10-year U.S. Treasury bond has a yield of 5%. ●The annualized standard deviation of the Sao Paulo Bovespa stock index in the most recent year is 43%. ●The annualized standard deviation of Brazil's 10-year U.S. dollar-denominated bond in the most recent year is 27%. ●The appropriate beta to be used for the project is 1.2. ●The market risk premium is 7%. ●The risk-free interest is 3%. Which of the following choices is closest to the appropriate country risk premium and the cost of equity that Ellison should use in his analysis? country risk premium cost of equity for project ① 4. 8% 17.2% ② 4. 8% 23.3% ③ 7.6% 23.3%
35. Deconal Corporation has assets on its balance sheet of $200 million that are financed with 60% equity and 40% debt. The executive management team at Deconal is considering a major expansion that would require raising additional capital. David, the CFO of Deconal, has put together the following schedule for the costs of equity and debt:
amount of new equity (in millions)
cost of equity
amount of new debt (in millions)
after-tax cost of debt
0~99 100~179 180~299
7.2% 7.5% 8.0%
0~49 50~99 100~199
3.4% 4.0% 4. 6%
In a presentation to Deconal's Board of Directors, David makes the following statements: Statement A: If we maintain our target capital structure of 60% equity and 40% debt, the break point at which our cost of equity will increase to 7.5% is $280 million in new capital. Statement B: If we want to finance total assets of $600 million, our marginal cost of capital will increase to 6.64%. Are David's statements correct or incorrect? Statement A Statement B ① correct incorrect ② incorrect correct ③ incorrect incorrect
36. Oriency Company is considering a project that requires $56 million cash outlay and is expected to produce cash flow of $15 million per year for the next three years. Oriency's tax rate is 35%, and the before-tax cost of debt is 6%. The current share price of Oriency's stock is $27 and the expected dividend next year is $1.8 per share. Oriency's expected growth rate is 2%. Assume that Oriency finances the project with 70% equity and 30% debt, and the flotation cost for equity is 3%. The appropriate discount rate is the weighted average cost of capital (WACC). Which of the following choices is closest to the dollar amount of the flotation costs and the NPV for project? dollar amount of the flotation costs NPV for project ① $1176000 $2003910 ② $1176000 $3435268 ③ $1680000 $3435268
37. An increase in a company's cash conversion cycle and a decrease in the company's operating cycle could result from: cash conversion cycle(increase) operating cycle (decrease) ① decreased receivables turnover decreased in days of inventory ② decreased receivables turnover increased payables turnover ③ increased receivables turnover increased payables turnover
38. A company has just purchased a banker's acceptance for $37500. The acceptance will mature in 90 days for $40000. The bank discount yield (BDY) and the bond equivalent yield for this security are closest to: bank discount yield BDY) bond equivalent yield ① 25.0% 22. 6% ② 25.0% 26.7% ③ 25.3% 26.7%
A.①
B.②
C.③
A B C
A
[解析]
39. A company is investigating the purchase of a banker's acceptance (BA). The $1000000 face value BA has 150 days to maturity and is quoted at 4.05 percent on a discount-basis yield. If the company's marginal tax rate is 25 percent, then the money market yield on the BA is closest to:
A.3.13%.
B.4.12%.
C.4.18%.
A B C
B
[解析]
40. Victory Corp is a large domestic services firm with a good credit rating. The source of short-term financing it would most likely use is:
44. Which of the following board members would most likely be considered to be well chosen based on the principles of good corporate governance? A. A board member of Company A who is also the CEO of Company
A.
B.A board member of Company A who is a partner in an accounting firm that competes with the firm's auditor.
C.A board member of Company A who is president of Company B, when the CFO of company A sits on Company B's board.
48. A company is considering building a distribution center on developed land it acquired more than ten years ago at a cost of $400000. The company estimates that the cost of putting in utilities, sewers, roads, and other such costs of preparing the land for the distribution center at $200000. Alternatively, the undeveloped land could be sold today to another company for $600000. If the company builds the distribution center, the cost of the land for capital budgeting purposes is closest to: