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Interpret CF to creditors…aka what does it mean a firm has done if CF to creditors is positive vs negative?
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- Is there a consequence for reported profit or loss if a particular financial instrument, for example, a preference share, is designated as debt rather than equity? Explain the consequence.What is off-balance-sheet financing? Why might a companybe interested in using off-balance-sheet financing?Current liabilities affect a company’s liquidity. What is liquidity, and how do we evaluate it?
- what are the examples of Items that can be adjusted directly against equity rather than including profit or loss?1. difference b/w creditors and stockholders 2. why does "maximizing firm value" equal to "maximizing stockholders' equity"?Business risk is the combination of __________ risk and __________ risk. A. operating, financial B. operating, sales C. financial, sales D. sales, default
- What is the main problem in using a balance sheet to provide anaccurate assessment of the value of a company's equity?Q.Briefly explain the over-investment problem from the perspective of the agency costs between debtholders and equity holders.What does it mean to pay to transfer a liability between market participants? What would be an e.g? Please explain.
- An analyst who is interested in assessing a company’s fi nancial position is most likely to focus on which fi nancial statement? A . Balance sheet.Explain what is meant by the term ‘financial distress’. If we assume that financial distress exists, explain how and why financial distress would cause a firm’s equity to become riskier.Why are most decision makers particularly concerned about the amount of current liabilities reported by a company?
