Posted: January 2nd, 2017

Cash outlays that had been previously made and have no effect on the cash flows relevant to a current decision are called ________

Question 13.13. Breakeven analysis is used by a firm ________. (Points : 2.5) to determine the level of operations necessary to cover all fixed operating costs to determine the least cost of producing goods and services to evaluate the profitability associated with various levels of sales to determine the demand of a product Question 14.14. Cash outlays that had been previously made and have no effect on the cash flows relevant to a current decision are called ________. (Points : 2.5) incremental historical costs incremental past expenses opportunity costs foregone sunk costs Question 15.15. Which of the following is true of a dividend payout? (Points : 2.5) When a firm announces that it will increase its dividend, the share price usually decreases on that news. Dividend payments send a positive signal to investors in the marketplace that management believes that the stock is overvalued. When a firm pays out dividends the share price will fall. Dividend payouts have no impact on the share price of a stock in an efficient market Question 16.16.If a firm’s fixed operating costs decrease, the firm’s ________.(Points : 2.5) operating breakeven point will decrease operating breakeven point will increase sale price per unit will decrease sale price per unit will increase Question 17.17. ________ projects do not compete with each other; the acceptance of one ________ the others from consideration. (Points : 2.5) Capital; eliminates Independent; does not eliminate Mutually exclusive; eliminates Replacement; eliminates Question 18.18. Generally the least expensive source of long-term capital is ________. (Points : 2.5) retained earnings preferred stock long-term debt common stock Question 19.19. The book value of an asset is equal to the ________. (Points : 2.5) fair market value minus the accounting value original purchase price plus annual depreciation expense original purchase price minus accumulated depreciation depreciated value plus recaptured depreciation Question 20.20. Which of the following is true of leverage? (Points : 2.5) It refers to the effects that operating and financial fixed costs have on the returns that shareholders earn. It is associated with risks which are out of the control of managers. It includes the effect of operating fixed costs on the returns of shareholders and not the financial fixed costs. It is used to evaluate the profitability associated with various levels of sales Question 21.21. The tax treatment regarding the sale of existing assets that are sold for more than the original purchase price results in ________. (Points : 2.5) an ordinary tax benefit no tax benefit or liability a recaptured depreciation taxed as ordinary income a capital gain tax liability Question 22.22. The cost of common stock equity may be estimated by using the ________. (Points : 2.5) yield curve capital asset pricing model break-even analysis DuPont analysis Question 23.23.A firm with limited dollars available for capital expenditures is subject to ________.(Points : 2.5) capital dependency capital gains working capital constraints capital rationing