Entrepreneurial Finance
6th Edition
ISBN: 9781337635653
Author: Leach
Publisher: Cengage
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- Hedging is matching the maturities of assets and liabilities to reduce risk. Hedging is matching the maturities of assets and liabilities to reduce risk. is it true or false?arrow_forwardSeve &Exit According to the principle of conservatism, when faced with uncertainty about the value of an item, a company should use the Help measure that avoids Multiple Choice overstating assets and understating liabilities. overstating essets and liabilities. O understating assets and liabilities. understating essets and overstating liabilities.arrow_forwardCritically evaluate the pros and cons of the following statement: Financial statements are useless because they present assets at their historical costs rather than at their fair market values.arrow_forward
- any risk attached to a financial asset should not be considered when making an investment decision because all financial assets are risky. true or false?arrow_forwardWhen calculating a client’s net worth always use the sentiment value of each asset and the full, or outstanding, balance due for each liability. A. True B. Falsearrow_forwardThe desired rate of return on an investment should reflect the degree of risk involved. A. True B. Falsearrow_forward
- What if noncurrent asset is not a subtitle I can chose from? Is there another heading I can use or do I not put it on the balance sheet? Would it then fall under investments or intangible assets?arrow_forwardOff-Balance Sheet Activities do not have a direct impact on the financial stability or risk of a FI. True Falsearrow_forwardIn choosing where to invest, return and risk for an investment must be compared. It is not sufficient to choose an investment based only on return without taking risk into consideration. There are two methods or measures that compare return and risk. State these two methods, the formula for each and the criteria used in evaluating alternative investment of each method.arrow_forward
- Which is NOT a criteria for recognition of financial information in the IFRS Conceptual Framework? A) The item is measurable without a high degree of uncertainty B) The amount must be measured at historical cost. C) The item provides relevant information about the element D) The item provides a faithful representation of the element.arrow_forwardWhich of the following statements is false regarding planning analytical procedures in the revenue cycle? a. As revenue is typically regarded as a high-risk account, planning analytical procedures related to revenue are not required. b. The first step in planning analytical procedures includes developing an expectation of recorded amounts or ratios, and evaluating whether that expectation is precise enough to accomplish the relevant objective. c. Trend analysis would not be appropriate as a plan-fling analytical procedure in the revenue cycle. d. All of the above statements are false.arrow_forwardWhich is risk in the context of financial decision making and performance? Does performance increase or decrease with the type of risk you identify with?arrow_forward
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