corporate finance tutorial 7 quiz

What Is Shareholder Equity?

• The total liabilities of a company

• • The total value of a company’s assets.

• The residual interest in the company after liabilities are deducted from assets.

• The net income earned by the company during a financial year.
  
  

Which Financial Metric Is Most Directly Affected by Changes In The Payout Ratio?

• 1. Net income

• Total liabilities

• 1. Return on equity

• Retained earnings

A firm has a net profit of $100,000 and a payout ratio of 40%. What is the retained earnings amount?

What is The Primary Formula Used To Calculate Retained Earnings?

• Net Income x

  ( Payout Ratio)

• Net Income x (1 - Payout Ratio)

• Net Income x (1 + Payout Ratio)

• Ending Assets - Ending Liabilities

What is the debt-to-equity ratio if the total debt is $100,000 and the total equity is $300,000?

• 0.49

• 0.77

• 0.33

• 0.01

What is the purpose of calculating the debt-to-assets ratio?

• To determine the efficiency of equity usage.

• To calculate the dividend payout ratio.

• To assess the proportion of total assets financed by debt.

• To have fun

What is the primary purpose of financial modeling in corporate finance?

• To be safe

• To forecast a company’s future performance and support decision-making.

• To forgive and forget

• To love and to hold