Question 1

The formula to calculate the present value of an amount to be received in the future is:

Options :

A : PV = FV – [1 + (1+n) i]

B : PV = FV + [1 + (1-n) n]

C : PV = FV * [1 / (1+i) n]

D : PV = FV / [1 / (1-n) i]

Answer: C

Question 2

Under accrual basis of accounting, revenues are recognized when earned.

Options :

A : True

B : False

Answer: A

Question 3

Which are a measure of the amount of resources used or consumed in providing a service, not cashout flows?

Options :

A : Operating income

B : Credit

C : Revenue

D : Expense

Answer: D

Question 4

Direct financial benefits to investors can take which two forms?

Options :

A : Periodic payments in form of dividends and financial returns

B : Periodic interest and retained earnings

C : Periodic payments in form of dividends and retained earnings

D : None of the above

Answer: C

Question 5

A post office box located near a Federal Reserve Bank or branch that for a fee will pick up and process

checks quickly is called:

Options :

A : Pickup box

B : Lockbox

C : Process box

D : Live box

Answer: B