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    Bài tập chương 4,5 - gửi

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    Nhi D
    The document contains 15 multiple choice questions about finance and accounting concepts such as budgeting approaches, capital expenditures, revenue expenditures, net present value calculations, internal rate of return, payback period, perpetuities, and annuities. The questions assess understanding of topics like discounted cash flow analysis, cost of capital, and investment decision criteria.

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    Bài tập chương 4,5 - gửi

    Uploaded by

    Nhi D
    72 views3 pages
    The document contains 15 multiple choice questions about finance and accounting concepts such as budgeting approaches, capital expenditures, revenue expenditures, net present value calculations, internal rate of return, payback period, perpetuities, and annuities. The questions assess understanding of topics like discounted cash flow analysis, cost of capital, and investment decision criteria.

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    Bài tập chương 4,5 - gửi (1) (1)

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    The document contains 15 multiple choice questions about finance and accounting concepts such as budgeting approaches, capital expenditures, revenue expenditures, net present value calculations, internal rate of return, payback period, perpetuities, and annuities. The questions assess understanding of topics like discounted cash flow analysis, cost of capital, and investment decision criteria.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    72 views3 pages

    Bài tập chương 4,5 - gửi

    Uploaded by

    Nhi D
    The document contains 15 multiple choice questions about finance and accounting concepts such as budgeting approaches, capital expenditures, revenue expenditures, net present value calculations, internal rate of return, payback period, perpetuities, and annuities. The questions assess understanding of topics like discounted cash flow analysis, cost of capital, and investment decision criteria.

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    © All Rights Reserved
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    Bài tập nhóm chương 4,5

    1. Which of the following statements about the top-down approach to budgeting are incorrect?
    (1) The target set is more attainable than the bottom-up approach.
    (2) It imposes budgets on junior managers.
    (3) It allows the participation of junior managers in budget preparation.
    (4) It speeds up the budget setting process.
    A. (2) and (4)
    B. (1) and (2)
    C. (1) and (3)
    D. (3) and (4)
    2. Which of the following statements about the participation of junior management in the budget
    setting process are correct?

    (1) It speeds up the budget setting process.


    (2) It increases their commitment to budgets.
    (3) It incorporates their knowledge into budgets.
    (4) It improves their morale and motivations.

    A. (1), (2) and (3)


    B. (1), (2) and (4)
    C. (2), (3) and (4)
    D. (1), (3) and (4)
    3. Which one of the following is true about capital expenditure?
    A. These are the running expenses of the business
    B. They is expenditure which is incurred for the purpose of the trade of the business
    C. They reduce the profit of the concern
    D. They appear in the balance sheet

    4. Which of the following are examples of revenue expenditure?


    A. Purchase of inventories
    B. Improvements to the earning capacity of non-current assets
    C. Purchase of plant and machinery
    D. Purchase of land and buildings

    5. Project A has the following cash flows.


    Year Cash flow
    $
    0 (157,500)
    1 37,500
    2 52,500
    3 52,500
    4 20,000
    5 18,000
    What is project A's payback period?
    A. 3 years
    B. 3.25 years
    C. 3.75 years
    D. 4 years

    6. Calculate the effective annual rate of interest (to two decimal places) of 1.2% per month,
    compound.
    A. 15.39%
    B. 1.15%
    C. 9.62%
    D. 14.4%

    7. An investment project has net present values as follows:


    At a discount rate of 10% $3,200 positive
    At a discount rate of 16% $2,800 negative
    Using the above figures, what is the BEST approximation of the internal rate of return of the
    investment project?
    A. 11.3%
    B. 11.2%
    C. 12.3%
    D. 13.2%

    8. Using an interest rate of 10% per year the net present value (NPV) of a project has been
    correctly calculated as $50. If the interest rate is increased by 5% the NPV of the project falls by
    $60. What is the internal rate of return (IRR) of the project?
    A. 11.17%
    B. 11.4%
    C. 14.17%
    D. 17.14%

    9. Project A has the following cash flows.


    Year Cash flow
    $
    0 -600,000
    1 200,000
    2 250,000
    3 200,000
    4 100,000
    5 80,000
    The company's cost of capital is 12%.
    What is the discounted payback period of Project A?
    A. Between 1 and 2 years
    B. Between 2 and 3 years
    C. Between 3 and 4 years
    D. Between 4 and 5 years
    10. If the interest rate is 8.5%, what would you pay for a perpetuity of $1,564 starting in one
    year's time? (to the nearest $)

    11. An investor is to receive an annuity of $15,400 for five years commencing at the end of year
    1. It has a present value of $58,381. What is the rate of interest (to the nearest whole percent)?

    12. A sum of money was invested for 8 years at 6% per year and is now worth $3,000. What was
    the original amount invested (to the nearest $)?

    13. The following information relates to a two-year project.


    Initial investment $2 million
    Cash inflow Year 1 $1,500,000
    Cash inflow Year 2 $ 900,000
    Cost of capital Year 1 10%
    Cost of capital Year 2 15%
    What is the net present value of the project (to the nearest $500)?

    14. A project costs $113,730. If its life is expected to be five years and the cost of capital is 10%,
    what are the minimum annual savings required to make the project worthwhile?

    15. A project costs $40,000. It would earn $12,000 per year for the first three years and then
    $7,000 per year for the next three. Cost of capital is 12%. Is the project worth undertaking?

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