FLP Company has 1000 existing common shares.

The market value of the share is Php 90 and

Select one:

a. 11.11%

b. 1.11% =

c. 0.11%

d. 0.01%

These funds are obtained from banks and credit unions

Select one:

a. borrowed funds=

b. Short-term source

c. Owner's funds

d. Long-term source

FPL Company plans to make Php50,000 loan with Php7,000 annual interest. If the cost incurred
related to this instrument is Php2,000 and the total tax rate is 30%, what is the cost of debt?

Select one:

a. 10.21% =

b. 4.38%

c. 9.80%

d. 10.00%

This determines the amount of profit to be distributed among shareholders and amount of profit to be
treated as retained earnings for financing its long term growth

Select one:

a. Income Distribution Ratio

b. Share Issuance Policy

c. Net income sharing

This policy is usually used when the companies are facing constraints of earnings and unsuccessful
business operation

Select one:

a. Regular Dividend policy

b. Stable Dividend Policy

c. Unstable Policy

d. Irregular Dividend Policy =

Given:

Debt= 1,000,000 ; Common Shares = 10,000,000 ; Preference Shares = 5,000,000

Cost of Debt = 10% ; Cost of Preference Shares = 5% ; Cost of Equity = 3%

Find WACC

Select one:

a. 750,000

b. 650,000=

c. 1,250,000

d. 1,050,000

A corporation is issuing 10% common stock that should be sold for Php 15 each. The business will
incur flotation costs of Php 2 per share. With growth rate of 5% What is the cost of capital?

Select one:

a. 16.54% =
b. 13.54%

c. 4.12%

d. 13.08%

A corporation is issuing 10% common stock that should be sold for Php 15 each. The business will
incur flotation costs of Php 5 per share. What is the cost of equity?

Select one:

a. 10%

b. 15% =

c. 33.3%

d. 3%

This type of decision making applies when the projects proposed are independent from each other.
The acceptance or rejection of one proposal does not affect the decision on the other proposals.

Select one:

a. Accept-Reject=

b. none of the above

c. Capital Rationing

d. Mutually Exclusive

Which of the following has a wrong order based on the discussion in ​capital budgeting​ process

Select one:

a. Evaluation - Implementing - Performance Review

b. Identification of Proposals - Evaluation - Final Approval

c. Identification of Proposals - Screening of Proposals - Evaluation

d. Matching of Proposals- Performance Review - Final Approval =

Select one:

a. 200,000

b. 300,000

c. 150,000 =

d. 100,000

FPL Company has a net working capital of 100,000 and the company has 200,000 total liabilities of
which 150,000 are long term debts. What is the gross capital?

a. 150,000 =

b. 200,000

c. 250,000

d. 300,000

FPL company has machineries and equipment worth 150,000, land and building for business
1,000,000, Cash 150,000, Inventories 30,000 and accounts receivables 50,000. He also owes
200,000 to a bank. How much is the gross working capital?

Select one:

a. Php 230,000=

b. Php 1,180,000

c. Php 1,380,000

d. Php 380,000
FPL Company has a gross working capital of 100,000 and the company has 200,000 total liabilities
of which 150,000 are long term debts. What is the total current assets?

Select one:

a. 150,000

b. 100,000=
c. 50,000=

d. 250,000

This is a measure of both a company's efficiency and its short-term financial health.

FPL Company has a total Assets worth 400,000 of which 250,000 are non current the company also
has 200,000 total liabilities of which 150,000 are long term debts. What is the net working capital?

Select one:

200,000

150,000=

100,000

300,000
In this decision type of decision making, there are more than one proposal to be chosen however the
firm has limited funds so that’s why they must ration these project proposals. Usually, they select a
group of projects that yield the highest total return given such limited funds.

Select one:

Mutually Exclusive

Accept-Reject

Capital Rationing=

none of the above

This includes materials which have been put into production process but have not yet been
completed

Select one:

Finished Goods

Work in Progress=

Goods in Transit

Raw Materials
This is the minimum amount of capital that must be maintained

Select one:
Net Working Capital

Permanent Working Capital=

Gross Working Capital

Temporary Working Capital

This is also known as the benefit-cost ratio of a project.

Select one:

Profitability Ratio =

Post-Payback Profitability

Internal Rate of Return

Net Present Value

This is the excess capital over the minimum amount of working capital that must be maintained.

Select one:

Net Working Capital

Gross Working Capital

Permanent Working Capital

Temporary Working Capital-

This refers to a situation in which possible future events can have reasonable probabilities assigned
while uncertainty refers to situations in which there is no viable method of assigning probabilities to
future random events.

Select one:

Probability

Risk =

Luck

Capital
Which statement is false?

Select one:

a. Foreign direct investment can provide the receiving firm with the investment, new technologies,
capital, processes, products, organizational and management technologies which can help in
economic development

b. A Factoring portfolio is structured and maintained to match the investment objectives stated in its
prospectus. =

c. Lease may be defined as a contractual arrangement in which a party owning an asset provides
the asset for use to another, the right to use the assets to the user over a certain period of time,
for consideration in form of periodic payment, with or without a further payment.

d. Mutual funds are operated by money managers, who invest the fund's capital and attempt to
produce capital gains and income for the fund's investors

This is an investment vehicle for investors who pool their savings for investing in diversified portfolio
of securities with the aim of attractive yields and appreciation in their value.

Select one:

a. factoring

b. venture capital

c. merchant banking

d. mutual fund=

This is the money provided by investors to startup firms and small businesses with perceived
long-term growth potential

Select one:

a. mutual fund

b. merchant banking

c. factoring

d. venture capital =