单选题A firm is purchasing a new file server for $ 680000 with a 4-year expected life and a salvage value of $ 50000. It is expected that the new server will generate an additional $200000 in revenue each year. The firm will use the straight line method to depreciate the server for financial reporting, but the sum-of-year"s digits (SYD) method for tax purposes. How much tax will be payable in year two, assuming a 35 percent tax rate?
单选题The financial manager at IBFM, a farm implement distributor, is
contemplating the following three mutually exclusive projects. IBFM's required
rate of return is 9.5 percent. Based on the information provided, which should
the financial manager select and why?
Project
Investment at t=0
Cash Flow at t=1
IRR
NPV @ 9 5 percent
A
$10000
$11300
13.00
$320
B
$25000
$29000
16.00
$1484
C
$35000
$40250
15.00
$1758
A. Project A with the lowest initial investment.
B. Project B with the highest internal rate of return.
C. Project C with the highest net present value.
单选题A firm reported the following financial statement items:
millions
Net income
2,100
Non-cash charges
400
Interest expense
300
Capital expenditures
210
Working capital expenditures
0
Net borrowing
1,600
ax rate
40%
The free cash flow to the firm (FCFF) is closest to:
单选题With respect to the management of a fund to an index or an expected mandate, which of the following statements is a recommended procedure for compliance with Standards of Professional Conduct relating to suitability? A. Formulate an investment policy statement for the client. B. Regularly compare client constraints with capital market expectations to arrive at an appropriate asset allocation. C. Invest in a manner consistent with the stated mandates.
单选题Which of the following statements is most accurate about the responsibilities of an auditor for a publicly traded firm in the United States? The auditor:
单选题To gain insight into what portion of the company's asset is liquid, an analyst will most likely use:
单选题If the issuer of a bond is in default, the bond will be trading:
A. registered.
B. on accrual.
C. flat.
单选题Consider three bonds that have the same yield to maturity and maturity
单选题Which of the following statements about the role of the marginal cost of capital in determining the net present value of a project is most accurate? The marginal cost of capital should be used to discount the cash flows: A. if the firm's capital structure is expected to change during the project's life. B. of all projects the firm is considering. C. for potential projects that have a level of risk near that of the firm's average project.
单选题Within the Global Investment Performance Standards (GIPS) are supplemental provisions which must be applied to which of the following asset classes?
单选题Assume a stock index consists of many firms who have recently split
their stock. Which of the following weighting schemes will see a bias due to the
impact of stock splits?
A. Unweighted price series.
B. Standard and Poor's 500 Index.
C. Price-weighted series.
单选题Which of the following types of unemployment is most likely caused by long-run changes that eliminate some jobs while generating others for which unemployed workers are not qualified? A. Frictional. B. Structural. C. Cyclical.
单选题Which of the following statements concerning early debt retirement is least accurate? A. When debt is retired prior to maturity at its book value, no gain or loss is reported on the transaction. B. Under U. S. GAAP, an accounting gain or loss will usually be recorded for in substance defeasance. C. If a firm retires non-callable debt because interest rates have changed, there is usually no economic gain on the transaction.
单选题Joanna, CFA, manages several pension accounts and directs most of her trades through the Torrenia Brokerage House. Joanna does this because she believes she gets expedient and low-cost trade execution, and Torrenia provides her with excellent research reports used in the management of these accounts. ZNS, a small brokerage house, has just approached Joanna and said it will execute her trades at half the cost of Torrenia. However, ZNS does not have a research department. If Joanna declines to switch her business to ZNS, has she violated any CFA Institute Standards?
单选题As the demand (marginal benefit) curve becomes less elastic, if the equilibrium price and quantity remain unchanged, consumer surplus:
单选题An analyst does research about yield spreads difference between a callable bond and a putable bond. Compared to an otherwise identical option-free bond, market participants would most likely require that yield spreads be: A. larger for both a callable bond and a putable bond. B. larger for a callable bond and smaller for a putable bond. C. smaller for a callable bond and larger for a putable bond.
单选题An investor establishes a short position in a futures contract on Day 1 when the price per contract is $100. The investor deposits $5 per contract to meet the initial margin requirement. The maintenance margin requirement per contract is $3. The Day 2 settlement price that would require the investor deposit additional funds on Day 3 equal to $4 per contract is closest to:
单选题For a firm in perfect competition, as output increases the marginal revenue will most likely:
单选题Portfolio managers at Goodwin & Associates believe they can significantly alter the risk/return profile of their risky portfolios by allocating a portion of available funds to the risk-free asset. Which of the following statements correctly assesses the effect of combining the risk-free asset with a risky portfolio? Adding the risk-free asset will: A. decrease portfolio standard deviation due to its positive correlation with risky assets. B. decrease portfolio standard deviation because it is uncorrelated with risky assets. C. decrease portfolio standard deviation due to its negative correlation with risky assets.
单选题An analyst gathered the following information about a company: Net profit margin 5.0% Total asset turnover 2.0 Total assets/equity 2.5 Beta for the company's stock 1.5 Expected rate of return on the market index 10.0% Risk-free rate of return 5.0% The analyst expects the information above to accurately reflect the future. If the company wants to achieve a growth rate of at least 15% without changing its capital structure or issuing new equity, the maximum dividend payout ratio for the company would be closest to: A. 0.0%. B. 12.5%. C. 40.0%.