In making credit decisions, which of the following items is considered a market-specific factor?
A. Whether the reputation of the borrower enhances the credit application.
B. Whether the current debt-equity ratio is sufficiently low to not impact the probability of repayment.
C. Whether the debt can be secured by specific property.
D. Whether the position of the economy in the business cycle phase would affect the probability of borrower default
E. Whether the volatility of earnings could present a period where the periodic payment of interest and principal would be at risk.
Ans: D. Whether the position of the economy in the business cycle phase would affect the probability of borrower default
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If the proceeds from discounting a note receivable are less than the face value of the note, Interest Expense will be debited for the excess of the proceeds over the face value
Indicate whether the statement is true or false
Concerns related to the environment and sustainability
A) are becoming less important to the consuming public. B) are sometimes dictated by regulations and sometimes by perception. C) result in increased cost for the supply chain. D) are relevant to only the retail member of each supply chain.
The percentage of value of shipments that come from materials for the average manufacturer is:
A) greater than or equal to 40 and less than or equal to 49 percent. B) greater than or equal to 50 and less than or equal to 59 percent. C) greater than or equal to 60 and less than or equal to 69 percent. D) greater than or equal to 70 percent.
Hartzell Inc. had the following data for 2017, in millions: Net income = $600; after-tax operating income [EBIT (1-T)] = $700; and Total assets = $2,000. Information for 2018 is as follows: Net income = $825; after-tax operating income [EBIT (1-T)] = $825; and Total assets = $2,500. Assume the firm had no excess cash. How much free cash flow did the firm generate during 2018?
A. $397 B. $286 C. $257 D. $367 E. $325