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An important advantage of a sole proprietorship is that ________.A. it is easier to raise capital under such a structure than under other organizational formsB. it allows for an unlimited life of the businessC. it is relatively easy to createD. Both a and b are correct.

Which section of the statement of cash flows reflects the cash generated from or used by a company’s day-to-day operations?A. investing activitiesB. financing activitiesC. operating activitiesD. noncash activities

The unemployment rate equals ______.A. the number of people unemployed divided by the labor forceB. the number of people seeking work divided by the adult populationC. the number of people unemployed divided by the number of people employed D. the number of people unemployed plus the number of people working part-time divided by the adult population

Donna can invest today in a fund that will guarantee her a 5% return compounded annually for five years. She can invest $1,200 today, $1,400 one year from now, $1,800 two years from now, and $2,100 three years from now. If she can make these investments as scheduled, how much will she have accumulated five years from now?A. $6,878.97B. $7,632.23C. $8,142.52D. $8,799.49

A shareholder is someone who ________.A. sits on the audit committee of a firmB. is an ex-employee of a companyC. profits from the favorable results of a companyD. follows the company for an investment firm

Which method of accounting must be used by publicly traded companies?A. cash basisB. accrual basisC. a hybrid of cash and accrual basisD. modified accelerated basis

In an organization with each of these financial positions, which title is most likely to be associated with a job description that is less of a “hands-on” manager and that engages more in visionary and strategic planning?A. comptroller (or controller)B. treasurerC. vice president of financeD. chief financial officer (CFO)

What is the approximate present value of an ordinary annuity (beginning one year from now) of a stream of 12 annual payments of $87,000 if you use a discount rate of 6%?A. $773,154.04B. $747,278.92C. $729,394.95D. $718,974.58

You wish to endow a university chair of accounting for a salary of $100,000 per year to the recipient. The university will withdraw $100,000 each year for the recipient’s salary. The amount of your gift will remain untouched indefinitely, in perpetuity. The university can lock in a fixed rate for your investment of 2.8% per year. In order to achieve this, what is the approximate amount of the gift you would have to make now?A. $3,103,569B. $3,571,429C. $4,101,218D. $4,227,827

What is the process of determining which long-term or fixed assets to acquire in an effort to maximize shareholder value?A. Business financeB. Capital budgetingC. InvestmentsD. Financial markets and institutions