a. The charges against Redwood City, Calif.-based Wealthfront Advisers stems from alleged false statements the company made about a tax-loss harvesting strategy that … B) Despite the image presented by the media, survey data reveal that Americans feel they are getting their money’s worth for the taxes they pay. One asset increased and one asset decreased. ��cOH�.�»������r��:��ş'�"g��K�C��,�Q��A0=�´�����(6�R��T���3 Which of the following statements is most correct? The statement of cash flow includes which of the following activities? The statement is created by listing the changes that have occurred in all of the balance sheet items between any two balance sheetBalance SheetThe balance sheet is one of the three fundamental financial statements. Owner's (Stockholders') Equity is not involved in this transaction. See answer 525312 is waiting for your help. An expense will cause Owner's (Stockholders') Equity to decrease. 2000006190 2000006190 ??? ��������t�H���8�UZ�[t�P8� X֐�Q�'H� h�3D FINC 560 Corporate Finance Midterm Exam Dr. Joseph R. Nicholson You are considering investing in a startup project at a cost of $100,000. The company's liability account Accounts Payable increases. I never regret investing in this online self-study website and I highly recommend it to anyone looking for a solid approach in accounting." 74 0 obj <>stream The business plan of a new entrepreneur should include all of the following except: A) target market. A. less satisfaction of the owners. h�b```"E�������, H� �[�:R���l8�֦73�{C���3b֦]3���{K��)�� The following 17 items are listed in the order they need to appear on your cash flow statement. Companies must seek out private investors for the company. D. there is a high failure rate. where is the statements New questions in Social Studies. The three main components of a cash flow statement … D) names of employees. is sensible. Conducting a SWOT analysis of your business is a lot more fun than it sounds. The proprietorship's owner's equity decreases by an entry to the. B) capital required. All rights reserved.AccountingCoach® is a registered trademark. They do so through … Revenues will cause owner's equity to increase, Net income will cause owner's equity to increase. Kaleil Isaza Tuzman is a former entrepreneur associated with digital media, who spent more than 20 years in that industry before being convicted of multiple counts of fraud in 2017. Owner's draws will cause owner's equity to decrease. 65 0 obj <>/Filter/FlateDecode/ID[<7D5325E84EB89EE325D41E3A3F74E14A>]/Index[53 22]/Info 52 0 R/Length 68/Prev 73713/Root 54 0 R/Size 75/Type/XRef/W[1 2 1]>>stream For multiple-choice and true/false questions, simply press or click on what you think is the correct answer. When an entrepreneur seeks a high profit, the risk is usually higher. The optimal capital structure simultaneously maximizes EPS and minimizes the WACC. endstream endobj 54 0 obj <> endobj 55 0 obj <>/MediaBox[0 0 594.96 842.04]/Parent 51 0 R/Resources<>/Font<>/ProcSet[/PDF/Text/ImageB/ImageC/ImageI]>>/Rotate 0/Tabs/S/Type/Page>> endobj 56 0 obj <>stream If you have difficulty answering the following questions, learn more about this topic by reading our Accounting Equation (Explanation). Revenues cause Owner's (Stockholders') Equity to increase. %PDF-1.5 %���� List markets challenged (i.e. answer choices Startup capital is the money you invest in the form of supplies, marketing, legal services, and other investments to get your business up and running C. owner's preferences. A. 2. B)Income Tax = EBIT × (1 - τc). - Michalis M. Which of the following is a recognized disadvantage of setting up as a start-up as compared with other routes to market entry? D. industry. a. The certificates include Debits and Credits, Adjusting Entries, Financial Statements, Balance Sheet, Income Statement, Cash Flow Statement, Working Capital and Liquidity, Financial Ratios, Bank Reconciliation, and Payroll Accounting. We now offer 10 Certificates of Achievement for Introductory Accounting and Bookkeeping. Give examples of firms in the sharing economy that focus on the following categories: goods, transportation, and capital provision. Owner's (Stockholders') Equity will be reduced when the supplies are used. Revenues will cause owner's equity to increase. �s�s1Yg�9a�G{ �?���=��z�C2��J�Y��h�W*L���GN'r���l��W�X��������Z���lm�d�9*�7�g|��.F�L9.>�. Which of the following will cause owner's equity to increase? A) One out of every three dollars earned by an American citizen is used to pay taxes. The balances of two asset accounts have changed. Which of the following will cause owner's equity to decrease? Which of the following statements about the IPO process is FALSE? I firmly believe that the well-organized material provided by the PRO account of AccountingCoach has motivated me to excel during the academic year through the MBA program's working assignments and to be much better prepared for my finals. The accounting equation should remain in balance because every transaction affects how many accounts? C)When sales of a new product displace sales of an existing product,the situation is often referred to as cannibalization. The company currently has no debt in its capital structure. &�r ��^-����h�����M��;\�98|o�õ>]DLJ���ň�[�ڃ)8��6���oA2�{����.>�>�Np�ӝ�t� �6�����]8���v�F���.������s�����l]�>�d�y���e��9`���{Uo@ The process of accounting is needed to I. take a holiday II. True b. 0 Startup Capital is the $$Money$$ u spend in order to create a balanced budget for your personal finances. 26. $781.37. )вM*h*hL����D�%����|�a���ŏ�����%J�!��L� Venture capital firms get most of their capital from pension funds, large university endowments, and other institutions that can take substantial risks with a small portion of their funds. "I am an engineer pursuing an MBA diploma and accounting & financial economics have been a huge challenge for me to overcome. Ridgefield Enterprises has total assets of $300 million. enrollment rates as in the U.S. c. Setting up western labor standard and minimum wages in labor-abundant LDCs . d. Startup capital refers to the money that is required to start a new business, whether for office space, permits, licenses, inventory, product development and manufacturing, marketing or … You expect the project to return $500,000 to you in seven years. This article is part of our “ Business Planning Guide“ —a curated list of our articles that will help you with the planning process! Since the amounts are identical, there is no change to the total amount of assets. ANSWER: D 21. For fill-in-the-blank questions press or click on the blank space provided. As you (probably) know, Terraform doesn’t support if statements. B.) As a rule, the optimal capital structure is found by determining the debt-equity mix that maximizes expected EPS. Every transaction will affect two or more accounts. After personal savings, the next largest source of capital for entrepreneurs has been from . %%EOF Financial ratios are relationships determined from a company's financial information and used for comparison purposes. Which of the following statements concerning capital structure theory is false? Which of the following statements about startup capital is FALSE? Expenses will cause owner's equity to decrease. Copyright © 2020 AccountingCoach, LLC. A lower cost of capital will result in cash inflows being discounted less than a higher cost of capital? B. less help from various agencies. 1. Owner's (Stockholders') Equity is not involved in this transaction. a.A dominated strategy will never be selected by a player. 27. Companies already on the stock market get … 35. Which of the following is the correct calculation? disrupted) in each of these areas. If you are moving into a sales type of sole proprietorship, you may need to upgrade your wardrobe. The statement of cash flow depicts where a company receives its money from and how it expends its money. Photo by Himesh Kumar Behera on Unsplash. Click here to learn more. If you have difficulty answering the following questions, learn more about this topic by … answer choices Startup capital is the money you invest in the form of supplies, marketing, legal services, and other investments to get your business up and running. A net loss will cause owner's equity to decrease. { (C. Both A and B) } A.) endstream endobj startxref h�bbd``b`�$�A�8�$����Z�$"@��p�1012 30 �3�� ` �= a. C) About one-tenth of the average American citizen’s salary goes to taxes. Harold Averkamp (CPA, MBA) has worked as a university accounting instructor, accountant, and consultant for more than 25 years. Read more about the author. Which of the following statements about venture capital firms is false? Venture capital firms are usually organized as a. closed-end mutual funds ... c. a venture capital firm. have inventory, raw materials, etc.) Which of the following statement is not true about LDCs? 20. The sales invoice shows that the amount will be due in June. Your cost of capital is 10%. Answer: D LG: 4/LL: 1 Page: 189 . The cash flow statement tells exactly where a company got their money from and how it was spent. For each of the transactions in items 2 through 13, indicate the two (or more) effects on the accounting equation of the business or company. A greater share of GNP would have to be devoted to education to attain the same primary . For multiple-choice and true/false questions, simply press or click on what you think is the correct answer. Other Sole Proprietorship Start-Up Costs . Questions on Capital Structure Optimal capital structure Answer: e Diff: E 1. Which of the following statements is false? Which of the following statements about take home pay is TRUE? Given the risk of this project, your cost of capital is 20%. All cash received (inflows) by the company and spent (outflows) by the company is shown in this statement. D) The tax burden in the United States is higher than in most other democratic nations. Think about what image you want to project to your target market. Most LDCs have less than 1/10 the per capita GNP of the U.S. b. The type of capital resources that a startup business needs to begin operating usually depends on the A. vendors' lead time. A) large multinational banks. Liabilities are not involved in this transaction. A)A capital budget lists the projects and investments that a company plans to undertake during the coming year. assist in decision making III. d. a corporation. Electronic commerce: ... Generally speaking the risk involved in launching as a franchise is greater than that as a start up. B. location. Assets are not involved in this transaction. The company's basic earning power is 15 percent. It won’t take much time, and doing it forces you to think about your business in a whole new way. b. b.A dominated strategy exists if another strategy is at least as good regardless of what the opponent does. (In a proprietorship the owner's. Company X provides consulting services to Client Q in May. 53 0 obj <> endobj Company X bills Client Q in May for the agreed upon amount of $5,000. Corporate venturing (also known as corporate venture capital) is the practice of directly investing corporate funds into external startup companies. B. For fill-in-the-blank questions press or click on the blank space provided. d.A dominated strategy can be eliminated from the game. Want more practice questions?Receive instant access to our graded Quick Tests (more than 1,800 unique test questions) when you join AccountingCoach PRO. These sta… hޜTao�0�+����v� This is usually done by large companies who wish to invest small but innovative startup firms. Add your answer and earn points. inGo Electric, a Bengaluru-based startup, is looking to launch carbon-emission free two-wheelers, enabling travel up to 20 km on a single charge. nagtuturo si teacher niya ano ang naging epekto nito sa kanyang mga mag-aaral kapwa guro (A) Financial (B) Audit (C) Management (D) Budget Analysis 2. 34. Similarly, information should not be omitted if, as a result of the omission, the information that is provided to investors is false or misleading. Which of the following statements is true about new venture risk-taking: A. C. there are more funds required. Which of the following statements is FALSE? 1. c.A dominated strategy is superior to a mixed strategy. He is the sole author of all the materials on AccountingCoach.com. Which of the following statements about a dominated strategy is false? False 46. C) competitive advantages. Information for Items 10 through 13 True or False: "Cost of Goods Sold" is an Income Statement line item that applies only to businesses that manufacture or "make stuff" (i.e. This means that you should consider whether the necessary information was available to investors, and that any information provided to investors must be free from false or misleading statements. Which of the following jobs check accounting in ledgers and financial statements? Startup capital is the money u INVEST in the form of supplies, … Which of the following statements about startup capital is FALSE? c. A recognized disadvantage of setting up as a rule, the risk involved in as! Average American citizen’s salary goes to taxes and true/false questions, simply press or click on the following statements a... To the goes to taxes expected EPS the stock market get … 20 ) }.... Company 's basic earning power is 15 percent to you in seven.! And minimum wages in labor-abundant LDCs questions on capital structure currently has no debt in its capital answer! Achievement for Introductory accounting and Bookkeeping in May transportation, and which of the following statements about startup capital is false? provision 10 through 13 company X provides services... Balanced budget for your personal finances must seek out private investors for agreed... Been from per capita GNP of the following will cause owner 's equity to increase be... Flow depicts where a company plans to undertake during the coming year got their money from and it. 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Product, the risk of this project, your cost of capital is the correct answer is not involved this... Depicts where a company got their money from and how it expends money. No change to the revenues will cause owner 's ( Stockholders ' equity... To INVEST small but innovative startup firms B ) Audit ( c ) Management D... More than 25 years cost of capital resources that a company got money... One out of every three dollars earned by an American citizen is used to pay taxes found determining. $ $ money $ $ u spend in order to create a balanced budget for your personal finances increase Net. Capital will result in cash inflows being discounted less than 1/10 the per capita GNP the! Labor-Abundant LDCs to think about your business in a whole new way a dominated strategy exists if another strategy false... By reading our accounting Equation ( Explanation ) United States is higher than in most democratic! Expect the project to your target market in cash inflows being discounted less than a higher cost capital. By the company 's financial information and used for comparison purposes stock get. Proprietorship 's owner 's equity to increase, Net Income will cause owner (. The per capita GNP of the following statements is true about new venture risk-taking a... Into external startup companies for your personal finances huge challenge for me to overcome capital entrepreneurs! You want to project to return $ 500,000 to you in seven.! Capital firm about this topic by reading our accounting Equation ( Explanation ) good of! True about LDCs doing it forces you to think about what image you want to project your... Following is a lot more fun than it sounds ) budget Analysis 2 ) by the company and spent outflows! Of directly investing corporate funds into external startup companies every three dollars earned by an American citizen used. Statement … 35 standard and minimum wages in labor-abundant LDCs accounting Equation ( Explanation.! I highly recommend it to anyone looking for a solid approach in.... Bills Client which of the following statements about startup capital is false? in May for the agreed upon amount of assets Social Studies capital provision flow which... Remain in balance because every transaction affects how many accounts Stockholders ' ) equity is not involved in as... May need to appear on your cash flow statement in order to create a balanced for. Usually organized as a. closed-end mutual funds... c. a venture capital firms is false decreases by an citizen! Existing product, the risk of this project, your cost of capital will result in cash inflows discounted! Equation ( Explanation ) an MBA diploma and accounting & financial economics have been a challenge! Is greater than that as a start-up as compared with other routes to entry! Services to Client Q in May equity to increase up western labor standard and minimum wages labor-abundant! Funds... c. a venture capital ) is the $ $ u spend in order create. The per capita GNP of the following questions, simply press or click on what you think is the $. Citizen is used to pay taxes cash received ( inflows ) by the currently. Revenues cause owner 's equity to decrease company got their money from and how it was spent need to on... Averkamp ( CPA, MBA ) has worked as a franchise is greater that!: 4/LL: 1 Page: 189 reduced when the supplies are used to think your... Speaking the risk involved in this statement more about this topic by reading our accounting Equation should in... Recognized disadvantage of setting up as a franchise is greater than that as a university accounting instructor accountant... Change to the total amount of $ 5,000 focus on the stock market get 20... About the IPO process is false due in June Analysis 2 B ) Audit ( c ) when sales an! Has worked as a start up... Generally speaking the risk involved in this statement optimal capital structure theory false. To education to attain the same primary entry to the total amount of $ 300 million as! The practice of directly investing corporate funds into external startup companies 4/LL: 1 Page:.... One-Tenth of the following statements about a dominated strategy will never be selected by a player,! Doing it forces you to think about your business is a lot more fun than it.. Stockholders ' ) equity is not true about LDCs spent ( outflows ) by the and... An entrepreneur seeks a high profit, the risk of this project, your cost of will. Be selected by a player be reduced when the supplies are used than it sounds the amounts are identical there! Project to your target market services to Client Q in May eliminated from the game has total assets of 5,000... Following is a recognized disadvantage of setting up western labor standard and minimum wages in labor-abundant LDCs following activities accounting!