AFP CTP
Q: 1
Systemic risk can be caused by which of the following?
Options
Q: 2
ABC Company is considering investing in new production technology. ABC has projected that the
investment would add $5,000,000 in additional operating profit and that the resulting balance sheet
would show $7,000,000 in long-term debt and $11,000,000 in total equity. ABC has a 34% tax rate
and a 10% WACC. Which of the following is the investment's EVA?
Options
Q: 3
The accounting requirement that a product’s selling costs be recorded in the same period as the
product’s revenue is recorded, regardless of when the cash is paid, is an example of the:
Options
Q: 4
As a result of expanding into Canada, a U.S. company expects to receive Canadian dollar revenues on
a regular basis. It decides to set up a production facility in Canada to better serve its new customer
base. What could the company do to create a natural hedge to offset the exposure?
Options
Q: 5
Which of the following types of payment transactions requires the authorization of both the initiating
and the receiving party?
Options
Q: 6
When a company must determine the optimal mix of long-term borrowings versus common equity, it
is making which of the following types of corporate financial decisions?
Options
Q: 7
Capital budgeting is defined as the:
Options
Q: 8
A U.S. bank regularly transmits international payments to European based XYZ Bank. The payments
flow through an intermediary bank. Recently regulators audited the intermediary bank and
discovered the bank may be unknowingly facilitating illegal activities. What payment method was
MOST LIKELY used?
Options
Q: 9
The auditors of a private college are examining and auditing the college’s financial statements. The
statements are not presented in accordance with GAAP. What should the auditors do?
Options
Q: 10
A manager has prepared an analysis of five investment alternatives. Prior to selecting which
alternative to invest funds in, the manager calculated the anticipated return for all options. The
manager is only going to invest in one alternative. The four investments that are not chosen are:
Options
Question 1 of 10
