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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 are the examples of Items that can be adjusted directly against equity rather than including profit or loss?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?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?