Financial Management - Study Mode
[#556] Future value of interest if it is calculated two times a year can be a classified as
Correct Answer
(D) semi-annual compounding
Explanation
Solution: Future value of interest if it is calculated two times a year can be a classified as semi-annual compounding. A semiannual event happens twice a year, typically every six months.
[#557] Payment if it is divided with interest rate will be formula of
Correct Answer
(B) present value of perpetuity
Explanation
Solution: Payment if it is divided with interest rate will be formula of present value of perpetuity. A perpetuity is a type of annuity that receives an infinite amount of periodic payments. An annuity is a financial instrument that pays consistent periodic payments. As with any annuity, the perpetuity value formula sums the present value of future cash flows.
[#558] An earning before interest, taxes, depreciation and amortization are calculated by
Correct Answer
(A) subtracting operating cost from net sales
Explanation
Solution: An earning before interest, taxes, depreciation and amortization are calculated by subtracting operating cost from net sales. Earnings before interest and taxes is a measure of a firm's profit that includes all incomes and expenses except interest expenses and income tax expenses.
[#559] Until word of preferred is used, an equity in balance sheet is treated as
Correct Answer
(A) common equity
Explanation
Solution: Until word of preferred is used, an equity in balance sheet is treated as common equity. Common equity is the amount that all common shareholders have invested in a company. Most importantly, this includes the value of the common shares themselves.
[#560] Future value of annuity FVA(due) is, if deposited value is Rs 100 and earn 5% every year of total three years will be
Correct Answer
(D) Rs 331.01