Question 1

"Cash burn" is the cash a venture expends on its operating, financing, and depreciation expenses.

Accepted Answer

A) True 
 B)False

Question 2

What is Runs and Goses' sales to total asset ratio?

Accepted Answer

A)  1.91 
B)  0.25 
C)  0.52 
D)  0.23 
E)  0.57 
A)  1.91 
B)  0.25 
C)  0.52 
D)  0.23 
E)  0.57

Question 3

Cash burn and liquidity ratios are important during the development and startup life cycle stages.

Accepted Answer

A) True 
 B)False

Question 4

Leverage ratios indicate the extent to which the venture has used debt and its ability to meet debt obligations.

Accepted Answer

A) True 
 B)False

Question 5

The gross profit margin for Runs and Goses is?

Accepted Answer

A)  26.2% 
B)  30.3% 
C)  43.3% 
D)  56.3% 
E)  60.0% 
A)  26.2% 
B)  30.3% 
C)  43.3% 
D)  56.3% 
E)  60.0%

Question 6

The type of financing used during the survival life cycle stage is second-round, mezzanine, and liquidity-stage financing.

Accepted Answer

A) True 
 B)False

Question 7

A firm has the following balance sheet information: total assets = $100,000; current assets = $30,000; inventories = $10,000; cash = $5,000; total liabilities = $30,000; current liabilities = $15,000; notes payable = $2,000. What are the firm's quick and NWC-to-Total-Assets ratios?

Accepted Answer

A)  1.00 and .13 
B)  1.33 and .13 
C)  1.00 and .15 
D)  1.33 and .15 
A)  1.00 and .13 
B)  1.33 and .13 
C)  1.00 and .15 
D)  1.33 and .15

Question 8

Second-round, mezzanine, and liquidity-stage financing generally occur during a venture's survival stage.

Accepted Answer

A) True 
 B)False

Question 9

Which of the following is not a profitability and efficiency ratio?

Accepted Answer

A)  sales-to-total-assets 
B)  return on equity 
C)  return on assets 
D)  inventory-to-total assets 
E)  NOPAT profit margin 
A)  sales-to-total-assets 
B)  return on equity 
C)  return on assets 
D)  inventory-to-total assets 
E)  NOPAT profit margin

Question 10

Net working capital is a dollar amount measure of the cushion between current assets and current liabilities.

Accepted Answer

A) True 
 B)False

Question 11

"Net cash burn" is calculated as:

Accepted Answer

A)  cash burn plus cash build 
B)  cash build minus cash burn 
C)  cash burn minus cash build 
D)  cash burn minus cash build squared 
A)  cash burn plus cash build 
B)  cash build minus cash burn 
C)  cash burn minus cash build 
D)  cash burn minus cash build squared

Question 12

Average current assets minus average inventories when divided by average current liabilities is called which of the following ratios?

Accepted Answer

A)  current ratio 
B)  quick ratio 
C)  net working capital ratio 
D)  current liabilities to total debt ratio 
A)  current ratio 
B)  quick ratio 
C)  net working capital ratio 
D)  current liabilities to total debt ratio

Question 13

What is Runs and Goses' return on total assets?

Accepted Answer

A)  9.6% 
B)  13.6% 
C)  19.1% 
D)  37.9% 
E)  22.5% 
A)  9.6% 
B)  13.6% 
C)  19.1% 
D)  37.9% 
E)  22.5%

Question 14

How efficiently a venture controls its expenses and uses its assets and debt is evaluated with profitability and efficiency ratios.

Accepted Answer

A) True 
 B)False

Question 15

The equity multiplier is considered an efficiency ratio.

Accepted Answer

A) True 
 B)False

Question 16

A venture's cash, marketable securities, and receivables comprise the venture's "liquid assets".

Accepted Answer

A) True 
 B)False

Question 17

The term "cash build" as used in Chapter 5 is equal to net sales minus the change in receivables.

Accepted Answer

A) True 
 B)False

Question 18

"Net working capital" is calculated as fixed assets minus current liabilities.

Accepted Answer

A) True 
 B)False

Question 19

Accounting rules require that the current maturities of long-term debt obligations be classified as short-term liabilities.

Accepted Answer

A) True 
 B)False

Question 20

First-round financing occurs primarily during which of the following life cycle stages?

Accepted Answer

A)  development stage 
B)  startup stage 
C)  survival stage 
D)  rapid-growth stage 
A)  development stage 
B)  startup stage 
C)  survival stage 
D)  rapid-growth stage

"Cash burn" is the cash a venture expends on its operating, financing, and depreciation expenses.

What is Runs and Goses' sales to total asset ratio?

Cash burn and liquidity ratios are important during the development and startup life cycle stages.

Leverage ratios indicate the extent to which the venture has used debt and its ability to meet debt obligations.

The gross profit margin for Runs and Goses is?

The type of financing used during the survival life cycle stage is second-round, mezzanine, and liquidity-stage financing.

A firm has the following balance sheet information: total assets = $100,000; current assets = $30,000; inventories = $10,000; cash = $5,000; total liabilities = $30,000; current liabilities = $15,000; notes payable = $2,000. What are the firm's quick and NWC-to-Total-Assets ratios?

Second-round, mezzanine, and liquidity-stage financing generally occur during a venture's survival stage.

Which of the following is not a profitability and efficiency ratio?

Net working capital is a dollar amount measure of the cushion between current assets and current liabilities.

"Net cash burn" is calculated as:

Average current assets minus average inventories when divided by average current liabilities is called which of the following ratios?

What is Runs and Goses' return on total assets?

How efficiently a venture controls its expenses and uses its assets and debt is evaluated with profitability and efficiency ratios.

The equity multiplier is considered an efficiency ratio.

A venture's cash, marketable securities, and receivables comprise the venture's "liquid assets".

The term "cash build" as used in Chapter 5 is equal to net sales minus the change in receivables.

"Net working capital" is calculated as fixed assets minus current liabilities.

Accounting rules require that the current maturities of long-term debt obligations be classified as short-term liabilities.

First-round financing occurs primarily during which of the following life cycle stages?

Introduction to Finance for Entrepreneurs

Developing the Business Idea

Organizing and Financing a New Venture

Preparing and Using Financial Statements

Managing Cash Flow

Types and Costs of Financial Capital

Securities Law Considerations When Obtaining Venture Financing

Projecting Financial Statements

Valuing Early-Stage Ventures

Venture Capital Valuation Methods

Professional Venture Capital

Other Financing Alternatives

Security Structures and Determining Enterprise Values

Harvesting the Business Venture Investment

Financially Troubled Ventures: Turnaround Opportunities

Filters

Exam 5: Evaluating Operating and Financial Performance

"Cash burn" is the cash a venture expends on its operating, financing, and depreciation expenses.

What is Runs and Goses' sales to total asset ratio?

Cash burn and liquidity ratios are important during the development and startup life cycle stages.

Leverage ratios indicate the extent to which the venture has used debt and its ability to meet debt obligations.

The gross profit margin for Runs and Goses is?

The type of financing used during the survival life cycle stage is second-round, mezzanine, and liquidity-stage financing.

A firm has the following balance sheet information: total assets = $100,000; current assets = $30,000; inventories = $10,000; cash = $5,000; total liabilities = $30,000; current liabilities = $15,000; notes payable = $2,000. What are the firm's quick and NWC-to-Total-Assets ratios?

Second-round, mezzanine, and liquidity-stage financing generally occur during a venture's survival stage.

Which of the following is not a profitability and efficiency ratio?

Net working capital is a dollar amount measure of the cushion between current assets and current liabilities.

"Net cash burn" is calculated as:

Average current assets minus average inventories when divided by average current liabilities is called which of the following ratios?

What is Runs and Goses' return on total assets?

How efficiently a venture controls its expenses and uses its assets and debt is evaluated with profitability and efficiency ratios.

The equity multiplier is considered an efficiency ratio.

A venture's cash, marketable securities, and receivables comprise the venture's "liquid assets".

The term "cash build" as used in Chapter 5 is equal to net sales minus the change in receivables.

"Net working capital" is calculated as fixed assets minus current liabilities.

Accounting rules require that the current maturities of long-term debt obligations be classified as short-term liabilities.

First-round financing occurs primarily during which of the following life cycle stages?

Introduction to Finance for Entrepreneurs

Developing the Business Idea

Organizing and Financing a New Venture

Preparing and Using Financial Statements

Managing Cash Flow

Types and Costs of Financial Capital

Securities Law Considerations When Obtaining Venture Financing

Projecting Financial Statements

Valuing Early-Stage Ventures

Venture Capital Valuation Methods

Professional Venture Capital

Other Financing Alternatives

Security Structures and Determining Enterprise Values

Harvesting the Business Venture Investment

Financially Troubled Ventures: Turnaround Opportunities

Filters