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4. Financial management involves decisions and activities that deal
with
5. Which of the following "tools" are likely to be used in financial
management?
6. A company has the following target capital structure and costs:The
company's marginal tax rate is 30%. What is the company's
weighted-average cost of capital?
7. A company has the following financial information: To maximize
shareholder wealth, the company should accept projects with
returns greater than what percent?
8. The measurement of the benefit lost by using resources for one
purpose and not another is
9. Which of the following statements is correct regarding the
weighted-average cost of capital (WACC)?
10.
Carter Co. paid $1,000,000 for land three years ago. Carter
estimates it can sell the land for $1,200,000, net of selling costs. If
the land is not sold, Carter plans to develop the land at a cost of
$1,500,000. Carter estimates net cash flow from the development
in the first year of operations would be $500,000. What is Carter's
opportunity cost of the development?
11.
A company with a combined federal and state tax rate of 30%
has the following capital structure:What is the weighted-average
after-tax cost of capital for this company?
12.
Which of the following is assigned to goods that were either
purchased or manufactured for resale?
13.
Management at MDK Corp. is deciding whether to replace a
delivery van. A new delivery van costing $40,000 can be
purchased to replace the existing delivery van, which cost the
company $30,000 and has accumulated depreciation of $20,000.
An employee of MDK has offered $12,000 for the old delivery van.
Ignoring income taxes, which of the following correctly states
relevant costs when making the decision whether to replace the
delivery vehicle?