Question 26 When preparing a funds statement using the all financial resources concept, the retirement of long-term debt by the issuance of common stock should be presented in a statement of changes in financial position as a Source of Funds Use of Funds   No No   No Yes   Yes No   Yes Yes Question 27 A measure of a company's financial flexibility is   Return on assets ratio   Return on sales ratio   Free cash flow   Accounts receivable turnover ratio Question 28 The working capital format is one possible format for presenting a statement of changes in financial position

Question 26

When preparing a funds statement using the all financial resources concept, the retirement of long-term debt by the issuance of common stock should be presented in a statement of changes in financial position as a Source of Funds Use of Funds

No No

No Yes

Yes No

Yes Yes

Question 27

A measure of a company's financial flexibility is

Return on assets ratio

Return on sales ratio

Free cash flow

Accounts receivable turnover ratio

Question 28

The working capital format is one possible format for presenting a statement of changes in financial position. Which of the following formats is (are) also theoretically acceptable? i)Cash ii)Quick Assets

Acceptable Not acceptable

Not acceptable Not acceptable

Not acceptable Acceptable

Acceptable Acceptable

Question 29

The firm's ability to use its financial resources to adapt to change is the definition of

Liquidity

Solvency

Financial flexibility

Working capital

Question 30

Which of the following is not an important aspect of SFAS No. 157 (FASB ASC 820)?

A new definition of fair value.

A requirement that all assets and liabilities are to be measured at their fair value.

A fair value hierarchy used to classify the source of information used in fair value measurements (for example, market based or nonmarket based).

New disclosures of assets and liabilities measured at fair value based on their level in the hierarchy.