Homework Answers
For mezzanine financing to work from an investor's point of view, the cash flows are an important factor for repayment. Such kind of financing is senior to equity but subordinate to debt in the event of repayment.
As such liquidity is a prime concern in lending during mezzanine financing and as a part of covenant a minimum liquidity ratio standard is prescribed.
Answer is C) Liquidity Ratios
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Question 19 (3 points) For Mezzanine financing these ratios are considered important: Conversion period ratios Efficiency...
Question 10 For each of tlle following match the description with the best response, Complete Points...
Question 10 For each of tlle following match the description with the best response, Complete Points out of 18.00 Liquidity Ratios These help to discover how long it generally takes for our customers to pay us after ordering. Lower is better. Is an indication of the amount left after subtracting COGS from total sales P Flag question Gross Profit Margin Is how many times has the firm spent and replenished cash in a period Cash Turnover Ratio Return on Common...
Problem 3) (25 points) A few liquidity ratios for Bravo Company are shown below. What do...
Problem 3) (25 points) A few liquidity ratios for Bravo Company are shown below. What do these liquidity ratios reveal to you about Bravo Company's liquidity position? (15 points) If they were available to you, what additional ratios would you like to review in order to get a clearer picture of the strength or weakness of the Bravo Company? (10 points) 2016 2015 2014 2013 2012 Ind. Average Current ratio 2.6 2.4 2.5 2.2 1.9 1.8 Quick Ratio 0.9 0.8...
Question 19 (2 points) Which of the following is not considered to be a primary user...
Question 19 (2 points) Which of the following is not considered to be a primary user of financial information for which financial reporting standards are designed? a) Management b) Creditor c) Lender d) Investor
QUESTION 4 As a barometer of short-term liquidity the current ratio is limited by the nature...
QUESTION 4 As a barometer of short-term liquidity the current ratio is limited by the nature of its components. All of the following are reasons that this is true except: C A firm could have a high current ratio but not be able to meet demands for cash because inventory is salable only at discounted rices. C The balance sheet is prepared as of a particular date and the actual amount of liquid assets may vary considerably from the date...
Question 24 (3 points) For entrepreneurial ventures operating in new or emerging industries, comparable data is...
Question 24 (3 points) For entrepreneurial ventures operating in new or emerging industries, comparable data is easier to locate. True False Question 25 (3 points) Which one of the following "measures" the average days of sales committed to the extension of trade credit? cash conversion cycle period purchase-to-payment conversion period inventory-to-sale conversion period sale-to-cash conversion period
3. In Exhibit 2.2 and 2.3 (page 35-36), for Asset Efficiency Ratios, there are several ratios...
3. In Exhibit 2.2 and 2.3 (page 35-36), for Asset Efficiency Ratios, there are several ratios and for these ratios, which one is/are "bigger is better"? I. Working Capital Turnover II. PPE Turnover III. Capital Expenditure % a. I only d. II & III only b. II only e. None of the above choices c. III only EXHIBIT 2.2 Operating Results for UPS Inc. (period ending Dec. 31, in milions) 2010 2011 2012 2013 2014 Opergh.com ) 9.545 5641 354...
Question 3 2 pts The ability to provide financial rewards sufficient to attract and retain financing...
Question 3 2 pts The ability to provide financial rewards sufficient to attract and retain financing is called: O Liquidity and efficiency Solvency Profitability. O Market prospects. Creditworthiness. 2pts tion 4 and performance across time is known as Question 2 2 pts External users of financial information: OAre those individuals involved in managing and operating the company Include internal auditors and managers. Are not directly involved in operating the company O Make strategic decisions for a company OMake operating decisions...
Question 1 (3 points) All current liabilities are included in the equation of calculating cash burn. True False
Question 1 (3 points) All current liabilities are included in the equation of calculating cash burn. True False
Question 1 (3 points) What are the three important dates for cash dividends? Select all that...
Question 1 (3 points) What are the three important dates for cash dividends? Select all that apply. Record Date Payment Date Declaration Date Obligation Date Distribution Date Dividend Date
QUESTION 25 Occasionally, companies engage in important investing and financing activities which do not affect cash....
QUESTION 25 Occasionally, companies engage in important investing and financing activities which do not affect cash. If the amount of the transaction is significant, how should it be disclosed when financial statements are prepared? 1. In investing activities. 2. In a note to the financial statements or in a supplemental schedule. 3. In both investing and financing activities. 4. In a separate section in the cash flow statement with a corresponding nero balance QUESTION 26 When determining the amount of...
Question 10 For each of tlle following match the description with the best response, Complete Points out of 18.00 Liquidity Ratios These help to discover how long it generally takes for our customers to pay us after ordering. Lower is better. Is an indication of the amount left after subtracting COGS from total sales P Flag question Gross Profit Margin Is how many times has the firm spent and replenished cash in a period Cash Turnover Ratio Return on Common...
Question 19 (2 points) Which of the following is not considered to be a primary user of financial information for which financial reporting standards are designed? a) Management b) Creditor c) Lender d) Investor
QUESTION 4 As a barometer of short-term liquidity the current ratio is limited by the nature of its components. All of the following are reasons that this is true except: C A firm could have a high current ratio but not be able to meet demands for cash because inventory is salable only at discounted rices. C The balance sheet is prepared as of a particular date and the actual amount of liquid assets may vary considerably from the date...
Question 24 (3 points) For entrepreneurial ventures operating in new or emerging industries, comparable data is easier to locate. True False Question 25 (3 points) Which one of the following "measures" the average days of sales committed to the extension of trade credit? cash conversion cycle period purchase-to-payment conversion period inventory-to-sale conversion period sale-to-cash conversion period
3. In Exhibit 2.2 and 2.3 (page 35-36), for Asset Efficiency Ratios, there are several ratios and for these ratios, which one is/are "bigger is better"? I. Working Capital Turnover II. PPE Turnover III. Capital Expenditure % a. I only d. II & III only b. II only e. None of the above choices c. III only EXHIBIT 2.2 Operating Results for UPS Inc. (period ending Dec. 31, in milions) 2010 2011 2012 2013 2014 Opergh.com ) 9.545 5641 354...
Question 3 2 pts The ability to provide financial rewards sufficient to attract and retain financing is called: O Liquidity and efficiency Solvency Profitability. O Market prospects. Creditworthiness. 2pts tion 4 and performance across time is known as Question 2 2 pts External users of financial information: OAre those individuals involved in managing and operating the company Include internal auditors and managers. Are not directly involved in operating the company O Make strategic decisions for a company OMake operating decisions...
Question 1 (3 points) All current liabilities are included in the equation of calculating cash burn. True False
Question 1 (3 points) What are the three important dates for cash dividends? Select all that apply. Record Date Payment Date Declaration Date Obligation Date Distribution Date Dividend Date
QUESTION 25 Occasionally, companies engage in important investing and financing activities which do not affect cash. If the amount of the transaction is significant, how should it be disclosed when financial statements are prepared? 1. In investing activities. 2. In a note to the financial statements or in a supplemental schedule. 3. In both investing and financing activities. 4. In a separate section in the cash flow statement with a corresponding nero balance QUESTION 26 When determining the amount of...
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