(2)The cost of debt of a company will least likely:
Group of answer choices
increase if the bond is callable.
increase if the bond is putable.
include both the cost of operating and capital leases.
The cost of debt of a company will least likely:
Ans: include both the cost of operating and capital leases.
(2)The cost of debt of a company will least likely: Group of answer choices increase if...
From the lessee’s perspective, in the earlier years of a lease, Group of answer choices A. finance leases will enable the lessee to report higher income, compared to operating leases. (Incorrect) B. finance leases will cause debt to increase, compared to operating leases. (Incorrect) C. operating leases will cause debt to increase, compared to finance leases. D. operating leases will cause income to increase, compared to finance leases. Which one is the correct answer?
Which of the following statements is FALSE? Group of answer choices The WACC can be used throughout the firm as the company wide cost of capital for new investments that are of comparable risk to the rest of the firm and that will not alter the firm's debt-equity ratio. A disadvantage of the WACC method is that you need to know how the firm's leverage policy is implemented to make the capital budgeting decision. The intuition for the WACC method...
Which of the following is the least likely treatment of an asset under U.S. GAAP? Group of answer choices a. The carrying value of an asset is recorded as $18,000 when the value of future cash flows from the asset is $19,000. b. A cost of $100,000 incurred in the development of software to improve the operating efficiency is capitalized. c. A loss of $100 is recognized when the fair value of the equipment falls from $250 to $150.
Which of the following statements are false (check all that apply)? Group of answer choices: A> Debt holders have limited upside. B> Equity providers limit their downside by securing their investment with assets as collateral. C> Lenders have more involvement in a business in order to protect their capital. D> Debt is less risky to the business because the cost of capital is lower.
Which of the following is most likely to be a variable cost for a firm? Group of answer choices a) the interest payments made on loans b) the franchiser's fee that a restaurant must pay to the national restaurant chain. c) the payroll taxes that are paid on employee wages d) the monthly rent on office space that it leased for a year
A mandated second night’s stay for normal births will likely: Group of answer choices a. improve birth outcomes. b. increase costs to insurers. c. reduce government revenues. d. Answers (a) and (b) are correct.
The yield on a zero-coupon bond of maturity T is equal to: Group of answer choices the return on the bond without coupons the forward rate of the bond the internal rate of return for the bond the cost of debt if assuming zero risk
Financial managers are interested in accelerating both cash inflows and cash disbursements. Group of answer choices True False Flag this Question Question 21 pts Which of the following types of accounts can be both a provider for precautionary and compensating balance requirement funds? Group of answer choices Indirect cost account Minimum demand deposit Maximum demand deposit Reimbursement account Flag this Question Question 31 pts Treasury bills are popular money market instruments even though they do not offer which of the...
Which of the following is not a cost to the firm of increasing debt financing? Group of answer choices Investors will demand a higher interest rate on debt. The risk to common stockholders will increase. Stockholders will demand a higher return. The cost of common equity will decrease.
6.2 A project's cost of capital The DW Media Group has an equity beta of 1.2 and 50% debt (debt over firm value) in its capital structure. The company has risk-free debt that costs 4% before taxes, and the expected rate of return of the stock market is 12%. DW is considering the acquisition of a new project in publishing business that is expected to yield 20% on after-tax operating cash flow. Penguin Publishing House, which has the same business...