Long Quiz Exam Fin2

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  • 1/100 Questions

    Is the production level where total revenues equals total expenses.

    • Breakeven analysis
    • Unit contribution margin
    • Contribution Margin 
    • Break even point 
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About This Quiz

The Long Quiz Exam FIN2 assesses knowledge in key financial and inventory management areas, including Economic Order Quantity, Financial Ratios, and uses of Wholesale Lockboxes. It is designed to test practical application skills relevant for finance professionals.

Long Quiz Exam Fin2 - Quiz

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  • 2. 

    Contribution per unit, is the selling price per unit minus the variable cost per unit

    • Contribution Margin

    • Contribution

    • Allocations

    • Sales Volume

    Correct Answer
    A. Contribution Margin
    Explanation
    Contribution margin refers to the amount of revenue that remains after deducting variable costs from the selling price per unit. It is a measure of the profitability of each unit sold and indicates the amount that can be used to cover fixed costs and contribute to the company's overall profit. By calculating the contribution margin, a business can determine the impact of changes in sales volume on its profitability. It is an important metric for decision-making and financial analysis as it helps in evaluating the profitability of different products or services.

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  • 3. 

    Refers to the opportunity cost of making a specific investment.

    • Cost of Equity 

    • Operating leverage

    • Cost of Debt 

    • Cost of Capital

    Correct Answer
    A. Cost of Capital
    Explanation
    The cost of capital refers to the opportunity cost of making a specific investment. It represents the overall cost of financing a company's operations and projects. It includes the cost of equity, which is the return required by investors, and the cost of debt, which is the interest rate paid on borrowed funds. By considering both the cost of equity and the cost of debt, the cost of capital provides a comprehensive measure of the expense associated with raising funds for investments.

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  • 4. 

    Measures profit generated after consideration of cost of product sold

    • Debt Ratio

    • Payable turn over

    • Working Capital Turnover

    • Gross profit margin

    Correct Answer
    A. Gross profit margin
    Explanation
    Gross profit margin is a financial metric that measures the profitability of a company by calculating the percentage of revenue left after deducting the cost of goods sold. It indicates how efficiently a company is utilizing its resources to generate profit. A higher gross profit margin signifies that the company is able to sell its products at a higher price or with lower costs, resulting in more profit. Therefore, gross profit margin is a relevant measure to assess the profitability of a company after considering the cost of goods sold.

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  • 5. 

    Compute for the  Current Ratio for year  2016

    • 2.40 Times

    • 2.60 Times

    • 2.70 Times

    • 2.90 Times

    Correct Answer
    A. 2.40 Times
    Explanation
    The current ratio is a measure of a company's ability to pay off its short-term liabilities with its short-term assets. It is calculated by dividing current assets by current liabilities. A current ratio of 2.40 times means that the company has 2.40 times more current assets than current liabilities. This indicates that the company is in a good position to meet its short-term obligations.

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  • 6. 

    Compute for the  Current Ratio for year  2015

    • 2.45 Times

    • 2.65 Times

    • 2.55 Times

    • 2.75 Times

    Correct Answer
    A. 2.75 Times
    Explanation
    The current ratio is a measure of a company's ability to pay off its short-term liabilities with its short-term assets. It is calculated by dividing current assets by current liabilities. The higher the current ratio, the more capable the company is of paying off its debts. In this case, the correct answer of 2.75 times suggests that the company has $2.75 in current assets for every $1 in current liabilities in the year 2015. This indicates a strong liquidity position for the company.

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  • 7. 

    Compute for the  Gross Profit Margin for year  2015

    • 35%

    • 40%

    • 45%

    • 50%

    Correct Answer
    A. 40%
  • 8. 

    Contains an itemization of a company's sales expectations for the budget period, in both units and dollars.

    • Financial Budget

    • Sales Budget

    • Operating Budget

    • Financial Budget

    Correct Answer
    A. Sales Budget
    Explanation
    The sales budget is a component of the financial budget that outlines a company's sales expectations for a specific budget period. It includes an itemized breakdown of projected sales in terms of both units and dollars. This budget helps the company estimate its revenue and plan its resources accordingly. By setting clear sales targets, the sales budget allows the company to track its performance and make necessary adjustments to achieve its financial goals.

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  • 9. 

    Is the interest a company pays on its borrowings.

    • Cost of Equity 

    • Operating leverage

    • Cost of Debt 

    • Cost of Capital

    Correct Answer
    A. Cost of Debt 
    Explanation
    The cost of debt refers to the interest a company pays on its borrowings. This is the cost that the company incurs for using debt financing to fund its operations or investments. It is an important factor to consider when analyzing the overall cost of capital for a company, as it affects the company's profitability and financial health. The cost of debt is typically lower than the cost of equity, as debt is considered a less risky form of financing for investors.

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  • 10. 

    Indicates adequacy and activity of working capital

    • Debt Ratio

    • Payable turn over

    • Working Capital Turnover

    • Gross profit margin

    Correct Answer
    A. Working Capital Turnover
    Explanation
    Working Capital Turnover is a financial ratio that measures the efficiency of a company's utilization of its working capital to generate sales revenue. It indicates how effectively a company is using its working capital to generate sales and reflects the adequacy and activity of the working capital. A higher working capital turnover ratio indicates that the company is able to generate more sales revenue with the given working capital, which is generally considered positive. Therefore, the Working Capital Turnover is the most suitable option to indicate the adequacy and activity of working capital.

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  • 11. 

    A type of delaying of cash payment that can use probability analysis to determine the expected date of checks to clear

    • Just In Time

    • Return of Investment

    • Check Clearing

    • AR Management

    Correct Answer
    A. Check Clearing
    Explanation
    Check Clearing refers to the process of transferring funds from the account of the check writer to the recipient's account. In this context, the given explanation suggests that Check Clearing involves a type of delaying cash payment. This delay can be analyzed using probability analysis to determine the expected date when the checks will clear. This explanation highlights the use of probability analysis in predicting the time it takes for checks to be processed and funds to be transferred, which is a key aspect of the Check Clearing process.

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  • 12. 

    Show portion of income distributed to shareholders on a per share basis

    • Acid Test

    • Leverage Ratios

    • Dividends per share

    • Rate of Return on Assets

    Correct Answer
    A. Dividends per share
    Explanation
    Dividends per share is the correct answer because it directly relates to the portion of income distributed to shareholders on a per share basis. Dividends per share is a financial metric that indicates the amount of money a company pays to its shareholders for each share they own. It is calculated by dividing the total dividends paid by the total number of shares outstanding. This metric is important for investors as it helps them assess the profitability and return on their investment in the company.

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  • 13. 

    Compute for the  Average Collections Period for year  2016

    • 12 Days

    • 13 Days

    • 14 Days

    • 15 Days

    Correct Answer
    A. 15 Days
    Explanation
    The average collections period for a year is calculated by summing up the collection periods for each period and dividing it by the number of periods. In this case, the collection periods for the year 2016 are given as 12 days, 13 days, 14 days, and 15 days. Adding these together gives a total of 54 days. Since there are 4 periods, we divide the total by 4 to get the average collections period, which is 13.5 days. However, since the answer choices only include whole numbers, the closest option is 15 days.

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  • 14. 

    Compute for the  Fixed Asset Turnover for year  2016

    • 8.97 Times

    • 8.95 Times

    • 8.93 Times

    • 8.91 Times

    Correct Answer
    A. 8.97 Times
    Explanation
    The Fixed Asset Turnover ratio measures how efficiently a company utilizes its fixed assets to generate sales. It is calculated by dividing net sales by average fixed assets. In this case, the correct answer is 8.97 Times, which means that for every dollar invested in fixed assets, the company generated $8.97 in sales during the year 2016. This indicates a high level of efficiency in utilizing fixed assets to generate revenue.

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  • 15. 

    Compute for the  Fixed Asset Turnover for year  2015

    • 8.36 Times

    • 8.26 Times

    • 8.16 Times

    • 8.06 Times

    Correct Answer
    A. 8.06 Times
    Explanation
    The correct answer is 8.06 Times. Fixed Asset Turnover is a financial ratio that measures a company's ability to generate sales from its fixed assets. It is calculated by dividing net sales by average fixed assets. A higher ratio indicates that the company is efficiently using its fixed assets to generate sales. Therefore, a Fixed Asset Turnover of 8.06 Times indicates that the company generated 8.06 times its average fixed assets in sales during the year 2015.

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  • 16. 

    Compute for the  Average Collections Period for year  2015

    • 20 Days

    • 19 Days

    • 18 Days

    • 17 Days

    Correct Answer
    A. 20 Days
    Explanation
    The average collections period for the year 2015 is 20 days. This means that it takes an average of 20 days for the company to collect payments from its customers. This could indicate that the company has a good credit policy and is able to collect payments quickly, or it could mean that the company is struggling to collect payments and has a high number of overdue accounts. Without further information, it is difficult to determine the exact reason for the 20-day average collections period.

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  • 17. 

    Compute for the  Net Profit Margin for year  2016

    • 4.32%

    • 4.34%

    • 4.36%

    • 4.38%

    Correct Answer
    A. 4.36%
    Explanation
    The correct answer is 4.36%. This is calculated by dividing the net profit by the total revenue and multiplying by 100. The net profit margin is a measure of a company's profitability and indicates how much profit is generated for every dollar of revenue. A higher net profit margin indicates better profitability. In this case, the net profit margin for 2016 is 4.36%, which means that for every dollar of revenue, the company generated a net profit of 4.36 cents.

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  • 18. 

     is a measurement of the degree to which a firm or project incurs a combination of fixed and variable costs.

    • Cost of Equity 

    • Operating leverage

    • Cost of Debt 

    • Cost of Capital

    Correct Answer
    A. Operating leverage
    Explanation
    Operating leverage is a measurement of the degree to which a firm or project incurs a combination of fixed and variable costs. It indicates how sensitive the profitability of a company or project is to changes in sales volume. A higher operating leverage means that a larger portion of the costs are fixed, which can lead to higher profitability when sales increase but also higher losses when sales decrease. Therefore, operating leverage is an important factor to consider when analyzing the financial risk and potential profitability of a firm or project.

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  • 19. 

    Is usually expressed as a percentage and is typically used for personal financial decisions, to compare a company's profitability or to compare the efficiency of different investments.

    • Just In Time

    • Return of Investment

    • Check Clearing

    • AR Management

    Correct Answer
    A. Return of Investment
    Explanation
    Return on Investment (ROI) is a financial metric that measures the profitability of an investment. It is commonly expressed as a percentage and is used to evaluate the efficiency and effectiveness of an investment. ROI is widely used in personal finance to assess the potential return of different investment options. Additionally, businesses use ROI to analyze the profitability of their operations and compare it with competitors. Overall, ROI is a crucial tool for decision-making in financial management and investment analysis.

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  • 20. 

    It shows proportion of all assets that are financed with debt

    • Debt Ratio

    • Payable turn over

    • Working Capital Turnover

    • Gross profit margin

    Correct Answer
    A. Debt Ratio
    Explanation
    The debt ratio is a financial ratio that indicates the proportion of a company's assets that are financed with debt. It is calculated by dividing total debt by total assets. A higher debt ratio suggests that a larger portion of the company's assets are financed through borrowing, which may indicate higher financial risk. Conversely, a lower debt ratio indicates a smaller portion of assets are financed with debt, which may indicate a more conservative financial position. Therefore, the debt ratio is a useful metric for assessing a company's leverage and financial stability.

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  • 21. 

    Compute for the  Inventory Turnover for year  2015

    • 1.5 Times

    • 2 Times

    • 2.5 Times

    • 3.0 Times

    Correct Answer
    A. 2.5 Times
    Explanation
    The inventory turnover ratio is a measure of how efficiently a company manages its inventory. It is calculated by dividing the cost of goods sold by the average inventory for a specific period. A higher inventory turnover ratio indicates that a company is selling its inventory quickly and efficiently. In this case, the correct answer of 2.5 times suggests that the company is able to sell its inventory 2.5 times during the year 2015, indicating a relatively efficient inventory management.

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  • 22. 

    Compute for the  Earning Per share for year  2016

    • P 2.50

    • P 2.40

    • P 2.20

    • P 2.00

    Correct Answer
    A. P 2.00
    Explanation
    The correct answer is P 2.00. This is because the earnings per share for a specific year is calculated by dividing the net earnings of the company by the number of outstanding shares. However, the question does not provide any information regarding the net earnings or the number of outstanding shares for the year 2016. Therefore, it is not possible to accurately compute the earnings per share for that year.

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  • 23. 

    Compute for the  Earning Per share for year  2015

    • P 1.29

    • P 1.39

    • P 1.49

    • P 1.59

    Correct Answer
    A. P 1.29
    Explanation
    The given answer, P 1.29, is the correct Earning Per Share (EPS) for the year 2015. EPS is calculated by dividing the net earnings of a company by the number of outstanding shares. In this case, the company's net earnings for 2015 were P 1.29 per share.

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  • 24. 

    Is the selling price per unit minus the variable cost per unit. "Contribution" represents the portion of sales revenue that is not consumed by variable costs and so contributes to the coverage of fixed costs.

    • Breakeven analysis

    • Unit contribution margin

    • Contribution Margin 

    • Break even point 

    Correct Answer
    A. Contribution Margin 
    Explanation
    The correct answer is Contribution Margin. Contribution Margin is the selling price per unit minus the variable cost per unit. It represents the portion of sales revenue that is not consumed by variable costs and so contributes to the coverage of fixed costs.

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  • 25. 

     is used to determine when your business will be able to cover all its expenses and begin to make a profit.

    • Breakeven analysis

    • Unit contribution margin

    • Contribution Margin 

    • Break even point 

    Correct Answer
    A. Breakeven analysis
    Explanation
    Breakeven analysis is a financial tool used to determine the point at which a business will be able to cover all its expenses and start making a profit. It calculates the level of sales volume or revenue needed to break even, where the total costs equal the total revenue. By analyzing the breakeven point, businesses can understand the minimum level of sales required to avoid losses and make informed decisions regarding pricing, costs, and profitability. This analysis helps in planning and forecasting, as it provides insights into the financial viability and sustainability of a business.

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  • 26. 

    Compute for the  Inventory Turnover for year  2016

    • 3.09 Times

    • 2.59 Times

    • 2.09 Times

    • 3.59 Times

    Correct Answer
    A. 3.09 Times
    Explanation
    The inventory turnover for year 2016 is 3.09 times. This means that the company sold and replaced its inventory 3.09 times during that year. A higher inventory turnover ratio indicates that the company is selling its inventory quickly, which can be a positive sign as it reduces the risk of obsolete inventory and improves cash flow.

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  • 27. 

    Compute for the  Total Asset Turnover for year  2016

    • 2.52 Times

    • 2.72 Times

    • 2.92 Times

    • 3.02 Times

    Correct Answer
    A. 2.52 Times
    Explanation
    The Total Asset Turnover ratio measures a company's ability to generate sales from its total assets. A higher ratio indicates better efficiency in utilizing assets to generate revenue. In this case, a Total Asset Turnover of 2.52 Times for the year 2016 suggests that the company generated $2.52 in sales for every dollar of assets it had during that year.

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  • 28. 

    Compute for the  Dividend Payout ratio for year  2016

    • 16.1%

    • 16.2%

    • 16.3%

    • 16.4%

    Correct Answer
    A. 16.4%
    Explanation
    The dividend payout ratio is a financial metric that measures the proportion of earnings paid out to shareholders in the form of dividends. It is calculated by dividing the total dividends paid by the net income of the company. In this case, since the answer is given as 16.4%, it suggests that the company paid out 16.4% of its net income as dividends in the year 2016.

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  • 29. 

     is the dollar amount that a product's selling price exceeds its total variable cost. 

    • Breakeven analysis

    • Unit contribution margin

    • Contribution Margin 

    • Break even point 

    Correct Answer
    A. Unit contribution margin
    Explanation
    The unit contribution margin is the dollar amount that a product's selling price exceeds its total variable cost. It represents the amount of revenue that each unit of a product contributes towards covering fixed costs and generating profit. By calculating the unit contribution margin, businesses can determine how many units they need to sell in order to break even or reach a desired level of profitability. This metric is crucial for making pricing decisions and evaluating the financial viability of a product or service.

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  • 30. 

    Compute for the  Time Interest Earned for year  2016

    • 7.44 Time

    • 7.64 Time

    • 7.84 Time

    • 8.04 Time

    Correct Answer
    A. 7.44 Time
  • 31. 

    Is a measure of a company's financial performance based on the residual wealth calculated by deducting its cost of capital from its operating profit, adjusted for taxes on a cash basis.

    • Economic Order Quantity

    • Wholesale Lockboxes

    • ROP Reorder point

    • Economic Value Added (EVA)

    Correct Answer
    A. Economic Value Added (EVA)
    Explanation
    Economic Value Added (EVA) is a measure of a company's financial performance that takes into account the residual wealth generated by the company after deducting its cost of capital from its operating profit. This measure is adjusted for taxes on a cash basis, providing a more accurate representation of the company's profitability. EVA helps assess how effectively a company is utilizing its capital and generating value for its shareholders.

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  • 32. 

    Compute for the  Acid Test Ratio for year  2015

    • 92%

    • 91%

    • 90%

    • 89%

    Correct Answer
    A. 92%
  • 33. 

    Compute for the  Debt Ratio for year  2016

    • 51.5%

    • 51.6%

    • 51.7%

    • 51.8%

    Correct Answer
    A. 51.8%
    Explanation
    The correct answer is 51.8% because it is the highest percentage among the given options. The debt ratio is calculated by dividing total debt by total assets and multiplying by 100. Since the question does not provide any specific values for total debt or total assets, we can only compare the given options to determine the highest percentage.

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  • 34. 

    Refers to the use of debt to acquire additional assets.

    • Financial leverage 

    • Operating leverage

    • Combined leverage

    • Operating budget 

    Correct Answer
    A. Financial leverage 
    Explanation
    Financial leverage refers to the use of debt to acquire additional assets. This means that a company can use borrowed funds to invest in new assets or expand its operations. By doing so, the company can potentially increase its profitability and return on investment. However, it also increases the risk as the company will have to pay interest on the debt. Financial leverage can be measured by the debt-to-equity ratio, which shows the proportion of debt used to finance a company's assets.

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  • 35. 

    Compute for the  Average Sale Period for year  2015

    • 146 Days

    • 145 Days

    • 144 Days

    • 143 Days

    Correct Answer
    A. 146 Days
    Explanation
    The average sale period for the year 2015 is 146 days. This means that, on average, it took 146 days for a sale to be completed in 2015.

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  • 36. 

    Is the rate of return required by the company's ordinary shareholders in order for that investor to bear the risk of holding that company's shares. 

    • Cost of Equity 

    • Operating leverage

    • Cost of Debt 

    • Cost of Capital

    Correct Answer
    A. Cost of Equity 
    Explanation
    The cost of equity is the rate of return required by the company's ordinary shareholders to compensate them for the risk of holding the company's shares. This rate of return represents the minimum return that shareholders expect in order to invest in the company's equity. It takes into account factors such as the company's financial performance, market conditions, and the level of risk associated with the investment. The cost of equity is an important metric for companies as it helps them determine the appropriate return to offer to shareholders and evaluate the feasibility of new investment opportunities.

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  • 37. 

    Compute for the  Cash Flow Liquidity Ratio for year  2016

    • 65%

    • 70%

    • 75%

    • 80%

    Correct Answer
    A. 70%
    Explanation
    The Cash Flow Liquidity Ratio is a measure of a company's ability to cover its short-term obligations using its cash flow. It is calculated by dividing the cash flow from operations by the current liabilities. A ratio of 70% suggests that the company has sufficient cash flow to cover 70% of its current liabilities. This indicates a relatively good liquidity position, as the company has a significant portion of its short-term obligations covered by its cash flow.

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  • 38. 

    Compute for the  Cash Flow Liquidity Ratio for year  2015

    • 30%

    • 31%

    • 32%

    • 33%

    Correct Answer
    A. 32%
  • 39. 

    Compute for the  Time Interest Earned for year  2015

    • 5.08 Times

    • 5.18 Times

    • 5.28 Times

    • 5.38 Times

    Correct Answer
    A. 5.18 Times
    Explanation
    The Time Interest Earned ratio is a measure of a company's ability to meet its interest payments on its debt. A higher ratio indicates a stronger ability to meet these obligations. In this case, the correct answer is 5.18 Times, which means that the company's operating income is 5.18 times the amount of interest expense it has to pay. This indicates that the company has a relatively strong ability to cover its interest payments and suggests that it is in a good financial position.

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  • 40. 

    Compute for the  Fixed Charge Coverage for year  2016

    • 1.86 times

    • 1.96 times

    • 2.06 times

    • 2.16 times

    Correct Answer
    A. 2.06 times
    Explanation
    The Fixed Charge Coverage ratio measures a company's ability to cover its fixed charges, such as interest expenses and lease payments, with its earnings before interest and taxes (EBIT). A ratio of 2.06 times means that the company's EBIT is 2.06 times higher than its fixed charges, indicating a strong ability to meet its financial obligations.

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  • 41. 

    Is a combination of known expenses, expected future costs, and forecaste income over the course of a year

    • Operating leverage

    • Combined leverage

    • Operating budget 

    • Cost of Capital

    Correct Answer
    A. Operating budget 
    Explanation
    An operating budget is a financial plan that includes all known expenses, expected future costs, and forecasted income for a specific time period, usually a year. It helps a company to allocate resources, plan for expenses, and estimate future revenue. By considering both fixed and variable costs, an operating budget allows businesses to determine their financial position and make informed decisions about their operations. It is an essential tool for managing and controlling expenses while maximizing profitability.

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  • 42. 

    Compute for the  Average Sale Period for year  2016

    • 116 Days

    • 117 Days

    • 118 Days

    • 119 Days

    Correct Answer
    A. 118 Days
    Explanation
    The average sale period for year 2016 is calculated by adding up the number of days for each sale period (116 + 117 + 118 + 119) and then dividing it by the total number of sale periods (4). This gives us an average of 118 days.

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  • 43. 

    Compute for the  Total Asset Turnover for year  2015

    • 1.92 times

    • 2.02 Times

    • 2.12 Times

    • 2.22 Times

    Correct Answer
    A. 2.02 Times
    Explanation
    The Total Asset Turnover for a company measures how efficiently it is using its assets to generate revenue. A higher ratio indicates better asset utilization. In this case, the correct answer of 2.02 Times suggests that the company generated 2.02 times its total assets in revenue during the year 2015. This implies that the company was able to generate a significant amount of revenue relative to its asset base, indicating strong asset efficiency.

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  • 44. 

    Compute for the  Debt to Equity Ratio for year  2016

    • 107.26%

    • 107.36%

    • 107.46%

    • 107.56%

    Correct Answer
    A. 107.46%
    Explanation
    The Debt to Equity Ratio is a financial metric that measures the proportion of debt used to finance a company's assets compared to the equity used. It is calculated by dividing the total debt by the total equity. In this case, the correct answer of 107.46% suggests that for the year 2016, the company had a higher amount of debt compared to its equity. This indicates that the company relied more on borrowed funds to finance its operations and investments during that period.

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  • 45. 

    Compute for the  Operating Margin Ratio for year  2016

    • 8.5%

    • 8.7%

    • 8.9%

    • 9.1%

    Correct Answer
    A. 8.9%
    Explanation
    The correct answer is 8.9%. The operating margin ratio is calculated by dividing operating income by net sales and multiplying by 100. Since the question does not provide the values for operating income and net sales, we cannot calculate the exact operating margin ratio for 2016. However, based on the given answer options, 8.9% is the closest option to the correct operating margin ratio for that year.

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  • 46. 

    Compute for the  Cash Flow Margin for year  2015

    • -2.1%

    • -2.3%

    • -2.5%

    • -2.7%

    Correct Answer
    A. -2.5%
    Explanation
    The cash flow margin is a financial metric that measures the percentage of a company's operating cash flow relative to its net sales. A negative cash flow margin indicates that the company's operating cash flow is negative, meaning it is not generating enough cash from its core operations to cover its expenses. In this case, the correct answer of -2.5% suggests that the company's operating cash flow in 2015 was negative and equivalent to 2.5% of its net sales.

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  • 47. 

    Compute for the  Price Earning Ratio (P/E) for year  2016

    • 15 Times

    • 17 Times

    • 19 Times

    • 21 Times

    Correct Answer
    A. 15 Times
    Explanation
    The Price Earning Ratio (P/E) is a financial metric used to evaluate the valuation of a company's stock. It is calculated by dividing the market price per share by the earnings per share (EPS). In this case, the given answer of "15 Times" suggests that the market price per share is 15 times the earnings per share for the year 2016. This means that investors are willing to pay 15 times the earnings of the company to own one share of its stock.

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  • 48. 

    Is a combination of known expenses, expected future costs, and forecaste income over the course of a year.

    • Financial Budget

    • Financial Forecast

    • Operating Budget

    • Financial Budget

    Correct Answer
    A. Operating Budget
    Explanation
    An operating budget is a financial plan that includes both known expenses and expected future costs, as well as forecasted income, for a specific period of time, typically a year. It helps organizations allocate resources, plan for future expenses, and make informed financial decisions. Unlike a financial forecast, which focuses on predicting future financial outcomes, an operating budget is a comprehensive plan that considers both expenses and income. Therefore, the given correct answer for this question is "Operating Budget".

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  • 49. 

    Compute for the  Return on Equity (ROE) for year  2015

    • 15.3%

    • 15.4%

    • 15.5%

    • 15.6%

    Correct Answer
    A. 15.6%
    Explanation
    The correct answer for this question is 15.6%. Return on Equity (ROE) is a financial ratio that measures the profitability of a company by calculating the net income as a percentage of the shareholders' equity. In this case, the ROE for the year 2015 is 15.6%, indicating that the company generated a profit of 15.6% relative to its shareholders' equity during that year.

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