Finance ( Questions) Comp-Xm

1.

The statement of cash flows for Baldwin Company shows what happens in the Cash account during the year. It can be seen as a summary of the sources and uses of cash (sources of cash are added, uses of cash are subtracted). Please answer which of the following is true if Baldwin makes plant improvements:
Select: 1
  It is a source of cash and will be shown in the financing section as an addition.
  It is a source of cash, and will be shown in the investing section as an addition.
  It is a use of cash, and will be shown in the investing section as a subtraction.
  It is a use of cash, and will be shown in the financing section as a subtraction.

 

 

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2.

This year Baldwin achieved an ROE of 2.0%. Suppose management takes measures that decrease Asset turnover (Sales/Total Assets) next year. Assuming Sales, Profits, and financial leverage remain the same, what effect would you expect this action to have on Baldwin’s ROE?
Select: 1
  Baldwin ROE will increase
  Baldwin ROE will remain the same
  Baldwin ROE will decrease

 

 

3.

On the income statement, which of the following would be classified as a variable cost?
Select: 1
  Direct Material Expense
  Promotion Expense
  R&D Expense
  Depreciation Expense

 

 

4.

It is January 2nd and senior management of Baldwin meets to determine their investment plan for the year. They decide to fully fund a plant and equipment purchase by issuing $10,000,000 in bonds. Assume the bonds are issued at face value and leverage changes to 2.7. Which of the following statements are true? Select all that apply.
Select: 3
  Working capital will remain the same at $13,458,221
  Total Assets will rise to $221,173,394
  The total investment for Baldwin will be $12,824,606
  Baldwin’s long-term debt will rise by $10,000,000
  Total liabilities will be $138,211,337

 

 

5.

he Baldwin’s workforce complement will grow by 20% (rounded to the nearest person) next year. Ignoring downsizing from automating, what would their total recruiting cost be? Assume Baldwin spends the same amount extra above the $1,000 recruiting base as they did last year.
Select: 1
  $3,130,000
  $520,000
  $624,000
  $3,756,000

 

 

6.

This year, Baldwin paid their workers $26.81 per hour. How much will they be paying them 3 rounds from now?
Select: 1
  $29.56
  $31.04
  $28.36
  $28.15

 

 

7.

Suppose the Chester company expands to other markets with good designs, high awareness and easy accessibility, what strategy would they be implementing?
Select: 1
  Niche cost leader
  Broad cost leader
  Niche differentiation
  Broad differentiation

 

 

8.

Andrews Corp. ended the year carrying $60,398,000 worth of inventory. Had they sold their entire inventory at their current prices, how many more dollars of contribution margin would it have brought to Andrews Corp.?
Select: 1
  $137,289,250
  $103,225,000
  $47,950,000
  $60,398,000