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CFI CBCA Core Course Assessments & Quizzes Latest Update -225 Questions with 100% Verified Correct Answers Guaranteed A+ Verified by Professor
According to the course, which is the most important section of the business plan? -
CORRECT ANSWER: Executive Summary
According to the growth/share matrix, companies at maturity have: - CORRECT
ANSWER: Low market growth and high market share
According to the study conducted on internal barriers to growth, which was the least important factor out of this list? - CORRECT ANSWER: Lack of successful innovation
At which stage of the firm lifecycle would a company most likely have high business
risk, low financial risk, and generate neutral net cash flow? - CORRECT ANSWER:
Growth
Authorized shares - CORRECT ANSWER: The total number of shares a company can
sell
Balance Sheet - CORRECT ANSWER: Retained earnings; Share captial
Based on the following scenarios, choose which company's loan request would have
the least favorable loss given default score. - CORRECT ANSWER: Company Y is
requesting a loan to finance the acquisition of a smaller company in their industry.
Based on the information below, how much does the company need to finance the working capital funding gap and how much is the lender willing to provide? 1 / 4
Funding gap (days) 35 Days in period 365 Revenues 2,500,000 Cost of goods sold 1,600,000
Receivables balance 300,000 Up to 50%
Inventories balance 150,000 Up to 50% - CORRECT ANSWER: Financing Required =
153,425 = Cost of goods sold * Funding gap (days) / Days in period Financing Allowed = 225,000 = Receivables + Inventories
Business review - CORRECT ANSWER: Involves re-assessing the direction of the
business, potential opportunities, and other issues the company is facing.
Calculate accounts receivable days based on the information below:
Revenues: 2,500,000
Costs of goods sold: 1,600,000
Days in period: 365
Receivables: 300,000
Inventories: 150,000
Payables: 200,000 - CORRECT ANSWER: 43.8 = (AR/Revenue)*Number of days in year
Calculate debt service coverage ratio (using EBITDA instead of EBIT) based on the
company's financial information below:
Net Operating Profit: 12,000
Depreciation & Amortization: 2,000
Accounts Payable: 2,000 2 / 4
Line of Credit: 2,500
Current Portion of Long-Term Debt: 3,000
Interest Expense: 800 - CORRECT ANSWER: = 2.2 =
12,000+2,000/(2,500+3,000+800)
Calculate funded debt to EBITDA ratio based on the company's financial information
below:
Net Operating Profit: 12,000
Depreciation & Amortization: 2,000
Accounts payable: 2,000
Line of Credit: 2,500
Current Portion of Long-Term Debt: 3,000
Non-Current Portion of Long-Term Debt: 15,000 - CORRECT ANSWER: = 1.5 =
(15,000+3,000+2,500)/(12,000+2,000)
Calculate the company's free cash flow for the current year based on the information
below:
Net income: 60,000
Depreciation: 25,000
Increase in accounts receivable: 12,000
Increase in inventory: 8,000
Increase in accounts payable: 15,000
Capital expenditures: 45,000
Increase in long-term debt: 15,000 - CORRECT ANSWER: Cash from Operations = Net income + Depreciation - Increase in accounts receivable - Increase in inventory + Increase in accounts payable = 80,000
Free cash flow = Cash from Operations - Capital Expenditures
- / 4
Free cash flow = 35,000
Calculate the end of the year cash balance based on the information below:
Beginning of the year cash balance: 2,000
Net income: 300
Depreciation: 140
Increase in accounts payable: 60
Acquisitions of PP&E: 580
Dividends paid in the current year: 130
Increase in long-term debt: 200 - CORRECT ANSWER: = 1,990
Calculate the net cash provided by the operating activities based on the information
below:
Net income: 60,000
Depreciation: 25,000
Increase in accounts receivable: 12,000
Increase in inventory: 8,000
Increase in accounts payable: 15,000 - CORRECT ANSWER: 80,000 = Net Income + Depreciation - Increase in accounts receivable - Increase in inventory + Increase in accounts payable
Calculate the ROI based on the cash flows of each year:
2020 Cash Flows -$2,000
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