1

What is Gross Profit in 2028E using the assumptions listed above and on
the Control Panel?

Your Answer
$17,545 
Correct Answer
$17,545 

Explanation
None.

2
What is EBITDA in 2022E using the assumptions listed above and on the
Control Panel?
Your Answer
$18,911 
Correct Answer
$18,911 

Explanation
None.

3
What is Cash Generated From Operating Activities in 2025E using the
assumptions listed above and on the Control Panel?
Your Answer
$13,523 
Correct Answer
$13,523 

Explanation
None.

4
What is the PP&E balance in 2030E using the assumptions listed above
and on the Control Panel?

Your Answer
$136,122 
Correct Answer
$136,122 

Explanation
None.

5
What is the cash ratio in 2025E using the assumptions listed above and on
the Control Panel?
Your Answer
4.9x 
Correct Answer
4.9x 

Explanation
None.

6
What is the margin impact ratio in 2026E using the assumptions listed
above and on the Control Panel?
Your Answer
0.19x 
Correct Answer
0.19x 

Explanation
None.

7
What is the cash turnover ratio in 2029E using the assumptions listed
above and on the Control Panel? Is it higher or lower than the same ratio
in 2020?
Your Answer
1.68x; higher 
Correct Answer
1.68x; higher 

Explanation
None.

8
What is the risk-free rate?
Your Answer
2.5% 
Correct Answer
2.5% 

Explanation
None.

9
Based on a discounted cash flow analysis and using the WACC as the
discount rate, what is the implied equity value of Company XYZ on January
1, 2021?
Your Answer
$73,712 
Correct Answer
$73,712 

Explanation
None.

10
What is the implied equity value at the transaction date (June 15, 2024)
based on a discounted cash flow analysis using the WACC as the discount
rate, and assuming $50 million of cash and zero debt?
Your Answer
$95,102 
Correct Answer
$95,102 

Explanation
None.

11
Assuming an investment is made on June 15, 2024 in an amount equal to
1.5x the equity value at that date, what is the investor IRR?

Your Answer
-6.30% 
Correct Answer
-6.30% 

Explanation
None.

12
Assuming an investment is made on June 15, 2024 in an amount equal to
1.5x the equity value at that date, what is the equity IRR if the investment
is funded with 70% debt?
Your Answer
12.0% 
Correct Answer
12.0% 

Explanation
None.
 13
The purpose of the income statement is to:
Your Answer
Show the revenues, expenses and operating profit for the financial year
Correct Answer
Show the revenues, expenses and operating profit for the financial year
Explanation
None.

14
What will a contingency note contain?
Your Answer
A disclosure of future contracts to be performed
Correct Answer
A circumstance where a company may have a liability
Explanation
None.

15
What is the result of inputting =IF(5>9,ok,error) into a cell?
Your Answer
#NAME?
Correct Answer
#NAME?
Explanation
This will result in a #NAME? error because quotations were not put
around "ok" and "error". The correct formula =IF(5>9,"ok","error") would
return "error" NEVER FORGET THE QUOTATION MARKS IN AN IF
STATEMENT

16
Which of the following companies has the lowest degree of leverage?
Your Answer
20% Debt, 80% Equity
Correct Answer
20% Debt, 80% Equity
Explanation
A company with the lowest degree of leverage has the lowest percentage
of debt and the highest percentage of equity.

17
Cash 100,000
Debt 60,000
Tax Rate 10%
Discount Rate 6%
Enterprise Value 500,000
Perpetual Growth Rate 4%
Given the data in the above table, calculate market capitalization of this
hypothetical company. 
Your Answer
$540,000
Correct Answer
$540,000
Explanation
Market capitalization = Enterprise value + Cash – Debt
Market capitalization = 500,000 + 100,000 - 60,000 = 540,000

18
What does a diagram of a perfectly positive correlation look like?
Your Answer
A perfectly straight line that slopes from the bottom left to the top right
quardrant
Correct Answer
A perfectly straight line that slopes from the bottom left to the top right
quardrant
Explanation
A perfectly positive correlation should have a diagram that contains a
perfectly straight line that slopes from the bottom left to the top right
quardrant.

19
When calculating the quick ratio or "acid test" which current asset or
liability is omitted?
Your Answer
Inventory
Correct Answer
Inventory
Explanation
Inventory is removed from quick ratio because it assumes that inventories
cannot be sold as fast as other current assets.

20
Which of the following items are not included in working capital?
Your Answer
Short term investments
Correct Answer
Short term investments
Explanation
The 3 components that affect working capital is receivables, payables and
inventory.
When performing a vertical analysis which income statement item do you
use to determine the cost contribution for each expense category? (What
is the denominator?)
Your Answer
Sales
Correct Answer
Sales
Explanation
Sales is the most common denominator used in vertical analysis.

22
Working capital movement is included in which section of the cash flow
statement?
Your Answer
Operating activities
Correct Answer
Operating activities
Explanation
Working capital is used in operations, so it should be included in the
operations section of the cash flow statement.

23
What is the impact on cash flow from operations in the current year based
on the change in operating assets and liabilities listed below?

Your Answer
-200
Correct Answer
-200
Explanation
Increase in accounts receivable = 1825- 1725 = 100 (This has a negative
impact on the cash flow)
Increase in inventory = 1785 - 1535 = 250  (This has a negative impact on
the cash flow)

Increase in accounts payable = 1475 - 1325 = 150  (This has a positive

impact on the cash flow)
In conclusion, the impact on cash flow = -100 - 250 + 150 = -200
 

24
What’s the retained earnings end of period based on the information
below?

 Retained earnings beginning of period: 7,500

 Net income: 2,300
 Dividends paid: 1,700

Your Answer
8,100
Correct Answer
8,100
Explanation
Retained earnings end of period = 7,500 + 2,300 – 1,700 = 8,100

25
Which of the following items can be found in a published cash flow
statement under "operating activities"? Select ALL correct answers.
Your Answer
Depreciation
Changes in operating assets and liabilities
Correct Answer
Depreciation
Changes in operating assets and liabilities
Explanation
None.
 26
Based on the course, which of the following ratios commonly estimates
the terminal value in a discounted cash flow (DCF) analysis?
Your Answer
EV/EBITDA
Correct Answer
EV/EBITDA
Explanation
EV/EBITDA is commonly used to estimate the terminal value in a DCF
analysis (Exit Multiple) because EV/EBITDA measures the value of the
entire company generated from the core business operations. This
multiple best estimates the value of a company past the forecast period.

27
What is the cost of equity using the capital asset pricing model if the risk
free rate is 4.5%, the beta is 1.75 and the equity risk premium is 4.25%?
Your Answer
11.94%
Correct Answer
11.94%
Explanation
Cost of equity = 4.5% + 1.75 x 4.25% = 11.94%

28
How do you find the terminal value using the EV/EBITDA exit multiple?
Your Answer
Terminal EV = EV/EBITDA x EBITDA value of final year of forecast
Correct Answer
Terminal EV = EV/EBITDA x EBITDA value of final year of forecast
Explanation
The EBITDA value used must be the EBITDA value of the final year of
forecast.

29
Which of the following describes the correct budgeting process?
Your Answer
Planning & communication – Establish objectives & targets – Develop a
detailed budget – Review & approval – Implementation and management
Correct Answer
Planning & communication – Establish objectives & targets – Develop a
detailed budget – Review & approval – Implementation and management
Explanation
The budgeting process is: Planning & communication – Establish
objectives & targets – Develop a detailed budget – Review & approval –
Implementation and management

30
What is the main argument of "Beyond Budgeting"?
Your Answer
Firms today need to be more flexible and responsive to deal with
unpredictable change, hyper competition and increasingly fickle
customers
Correct Answer
Firms today need to be more flexible and responsive to deal with
unpredictable change, hyper competition and increasingly fickle
customers
Explanation
Although there are 12 principles to beyond budgeting, they are completely
new principles, not ones added to the traditional principles.

Although CEO of General Electric states that budgets should never have
existed, "Beyond Budgeting" still argues that budgets should be made
more flexible instead, not eliminated.
"Beyond Budgeting" entails a shift from a performance emphasis on
numbers to one based on people and institutional arrangements, and
have nothing to do with operating and cash budget.

31
Identify which of the following is not a goal of the variance dashboard.
Your Answer
A detailed written report
Correct Answer
A detailed written report
Explanation
A dashboard should be a visual report. It should be light on words and use
graphics to convey the information.

32
Identify the cause of an unfavorable variance in profit.
Your Answer
Actual material cost is higher than budget
Correct Answer
Actual material cost is higher than budget
Explanation
If material costs are higher than budgeted, it increases expenses and
decreases profit.

If labor costs are lower than budgeted, it decreases expenses and

increases profit.

If sales volume is higher than budgeted, it increases revenue and

increases profit.

If sales price is higher than budgeted, it increases revenue and increases

profit.

33
The opening balance of Company A is 25,000, and the repayment is
scheduled for 1,000 per month at an annual interest rate of 5%. Use
the average debt balance to calculate the interest payment.

The closing balance of debt at the end of the month is _____ and the
interest payment is _____.
Your Answer
24,000; 102
Correct Answer
24,000; 102
Explanation
Closing balance = 25,000 - 1,000 = 24,000
Interest payment = (25,000 + 24,000) /2 x 5% /12 = 102

34

From the chart above, decision makers should pay most attention to the
month:
Your Answer
Sep 2018
Correct Answer
Sep 2018
Explanation
The cash balance in Sep 2018 get dangerously below zero, so
management should be aware of this situation and plan activities
accordingly.

35
The PP&E gross book value at the start of the month is 60,000, and the
CAPEX of the month is 12,000. The accumulated depreciation at the start
of the month is 25,000; the depreciation expense of the month is 750.
The net book value of PP&E calculated from the data above is _____.
Your Answer
46,250
Correct Answer
46,250
Explanation
Net book value of PP&E = (60,000 + 12,000) – (25,000 +750) = 46,250

36
When performing a scenario analysis, which of the following
tools/functions in Excel is used to create a dropdown list where we can
select the live case?
Your Answer
Data Validation
Correct Answer
Data Validation
Explanation
Data Validation is used to create a switch for the live case which the user
wants to test to see how changes in multiple inputs impact the output.
Data Table, Tornado Chart and the INDEX MATCH MATCH function are
used to perform a sensitivity analysis.

37
If you want to test how an increase in percentage of cost of good sold
affects the contribution margin, you would use ________.
Your Answer
Sensitivity analysis
Correct Answer
Sensitivity analysis
Explanation
Scenario analysis tests changes in multiple assumptions, like what will
happen if another "story" happens, while sensitivity analysis can only test
one assumption at a time. Although scenario analysis can be used to test
one variable, sensitivity analysis is much easier and provides multiple
ranges out output depending on changes to the assumption.

38
As an alternative to CTRL + C and then CTRL + V to perform copy and
paste, what combination of keys (as outlined in the videos) will perform
the same action?
Your Answer
CTRL + D
Correct Answer
CTRL + D
Explanation
A good way to remember the CTRL + D shortcut is that D stands for
duplicate

39
What do you set as the angle of the first slice in order to properly convert
and format the above gauge chart?
Your Answer
270°
Correct Answer
270°
Explanation
The area of the chart in blue must begin at 270° in order to properly
format the gauge chart

40
When creating a waterfall chart for ABC Inc.’s 2018 net earnings, which of
the data points do you need to set as totals? Select ALL correct answers.
Your Answer
Revenue
Gross profit
Net earnings
Correct Answer
Revenue
Gross profit
Net earnings
Suppose you want to copy a table from Excel and paste onto a PowerPoint slide. Which of the
following Excel shortcuts ONLY allows you to paste as a table?
Your Answer
CTRL + V
Correct Answer
CTRL + V
Explanation
The default in PowerPoint is to paste a table from Excel as a table in PowerPoint. In order to
paste the table as an image, you must use the paste special function. CTRL + V is the only option
that does not open Paste Special.

42
Suppose you have selected to Format Shape of a chosen textbox. Resize shape to fit text is
under which tab?
Your Answer
Text Box
Correct Answer
Text Box
Explanation
Resize shape to fit text is found under the Text Box section

43
Please sort the following into PEST Analysis, Porter's 5 Forces, Competitive Advantage
Analysis and SWOT Analysis
Weaknesses

Your Answer
SWOT Analysis
Correct Answer
SWOT Analysis

Economic Forecasting

Your Answer
PEST
Correct Answer
PEST

Cost Leadership

Your Answer
Competitive Advantage Analysis
Correct Answer
Competitive Advantage Analysis

Differentiation

Your Answer
Competitive Advantage Analysis
Correct Answer
Competitive Advantage Analysis

Social Forecasting

Your Answer
PEST
Correct Answer
PEST

Opportunities
Your Answer
SWOT Analysis
Correct Answer
SWOT Analysis

Potential new entrants and barriers to entry

Your Answer
Porter's 5 Forces
Correct Answer
Porter's 5 Forces

Technological Forecasting

Your Answer
PEST
Correct Answer
PEST

Suppliers and their bargaining power

Your Answer
Porter's 5 Forces
Correct Answer
Porter's 5 Forces
Explanation
Please review the Discounted Cash Flow (DCF) Analysis section.

Comparable Company & Precedent Transactions

44
Company A has 279,000 basic shares outstanding and 26,000 outstanding options and
warrants. The exercise price of these options is $3.75. The company also has $200,000 of
convertible bonds with an effective conversion price of $4.00. The average market share price
for the reporting period is $7.50. What is the diluted shares outstanding using the treasury
stock method & if-converted methods?
Your Answer
342,000
Correct Answer
342,000
Explanation
Additional shares issued if options are converted = 26,000 - (26,000 x $3.75 / $7.50) = 13,000
Shares issued if convertible bonds are converted = $200,000 / $4.00 = 50,000

Diluted shares outstanding = Basic shares outstanding + Dilution from options + Dilution from
convertible debt = 279,000 + 13,000 + 50,000 = 342,000

Transaction Costs
45
Total expected equity financing for Amazon’s purchase of Walmart, at the assumed 50-50%
equity and debt financing deal mix provided, is as follows:
Your Answer
$241,356
Correct Answer
$241,356
Explanation
None.

46
Total transaction costs, based on the assumptions provided, are expected to be:
Your Answer
$22,002
Correct Answer
$22,002
Explanation
None.

Pro-forma Adjustments
47
The incremental annual depreciation expense as a result of Amazon’s acquisition of Facebook,
is expected to be:
Your Answer
$36,847
Correct Answer
$36,847
Explanation
None.

48
Additional annual interest expense due to new debt issued in relation to the transaction is:
Your Answer
$7,482
Correct Answer
$7,482
Explanation
None.

Merger Model
49
The implied enterprise value of Snap Inc., calculated using the assumptions and acquisition
premium provided, is:
Your Answer
$91,669
Correct Answer
$91,669
Explanation
None.

50
The expected pro-forma share price of Amazon is expected to be:

Your Answer
$3,099.40
Correct Answer
$3,099.40
Explanation
None.