Question1: Which of the following items can be found on a firm’s balance sheet under current liabilities?
[A] Accrued amortization charges.
[B] Cost of goods sold.
[C] Accrued wages.
[D] Accounts receivable.
[E] Depreciation expenses.
Question2: Considered alone, which of the following would increase a company’s current ratio?
[A] An increase in net fixed assets.
[B] An increase in notes payable.
[C] An increase in accrued liabilities.
[D] An increase in accounts receivable.
[E] An increase in accounts payable.
Question3: Which of the following statements is CORRECT?
[A] Capital market instruments include both long-term debt and common stocks.
[B] If your uncle in New York sold 100 shares of Microsoft through his broker to an investor in Los Angeles, this would be a primary market transaction.
[C] While the two frequently perform similar functions, investment banks generally specialize in lending money, whereas commercial banks generally help companies raise large blocks of capital from investors.
[D] The NYSE does not exist as a physical location; rather it represents a loose collection of dealers who trade stock electronically.
[E] An example of a primary market transaction would be your uncle transferring 100 shares of Wal-Mart stock to you as a birthday gift.