Question

QUESTION 5

1. An estimate of a stock's "true" value based on accurate risk and return is known as the company's market price.

   True

   False

2.5 points   

QUESTION 6

1. The verbal section of a company's annual report discusses the company's past year's performance and future prospects.

   True

   False

2.5 points   

QUESTION 7

1. Income Statement gives a "snapshot" of a company's assets and who has claims on them on a given date.

   True

   False

2.5 points   

QUESTION 8

1. Stockholders' Equity can be calculated by subtracting total liabilities from total assets.

   True

   False

2.5 points   

QUESTION 9

1. Cost of assets depleted in the production process such as machinery, equipment, vehicle, etc. is known as amortization.

   True

   False

2.5 points   

QUESTION 10

1. The amount of cash that could be withdrawn without harming a firm's ability to operate and produce future cash flow is known as free cash flow.

   True

   False

2.5 points   

Answer 1

Q5: An estimate of a stock's "true" value based on accurate risk and return is known as the company's market price.

Answer: TRUE

The true value can be based on the totals assets subtracted by total liabilities after that the stock value is assigned which is known as the company’s market price. The real value of the stock can be further defined as the assets minus liabilities the end value is the real value of the company and divide the final figure will give the stock value.

Q6: The verbal section of a company's annual report discusses the company's past year's performance and future prospects.

Answer: TRUE

Because only the company annual report which mentions company’s past and future prospects that every organization releases at their annual reports. This will give an idea to the investors and customers where the company stands in the market and what are the company’s goals and missions and future projects.

Q7: Income Statement gives a "snapshot" of a company's assets and who has claims on them on a given date.

Answer: TRUE

The income statement or profit and loss statement is the snapshot that covers everything like assets, liabilities and shareholders’ equity.

Q8: Stockholders' Equity can be calculated by subtracting total liabilities from total assets.

Answer: TRUE

Stockholder’s equity is the amount of capital that is invested in the business by the shareholders. So after subtracting the liabilities from the total assets is known as stockholder’s equity

Q9: Cost of assets depleted in the production process such as machinery, equipment, vehicle, etc. is known as amortization.

Answer: FALSE

Amortization is the process of allocate the cost of intangible assets such as patents, copyrights, trademarks and franchises

Q10: The amount of cash that could be withdrawn without harming a firm's ability to operate and produce future cash flow is known as free cash flow.

Answer: TRUE

Because the amount which is used after operating all the expenses and debts. The cost that is left over and it is not harming the firm’s ability. These cash can be used to expand its operations.