Oakmont Corporation issued $ 100,000 of callable bonds on 1/1/99 at a coupon rate of interest of 7%.
The bonds sold at a discount which resulted in an effective yield of 8% to the bond investors. On January
1 , 2000, the yield on these bonds fell to approximately 7% as market conditions led to an increase in bond prices. What change, if any, should Oakmont make to its accounting records to reflect the change in the yield?

• A.Increase the carrying value of the bonds payable
• B.Compute future interest expense based on the 7% new effective rate
• C.No change is made to the accounting records

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Which financial statement would be most useful to an analyst who wants to evaluate a company's liquidity position and financial flexibility?

• A.Statement of Cash Flows
• B.Income Statement
• C.Balance Sheet

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Which measure gives investors rankings that are identical to those of the Sharpe ratio?

• A.Treynor ratio.
• B.M-square.
• C.Jensen Alpha.

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According to Porter, the chief competitive starategies a firm can pursue are:
I). low cost.
II). differentiation.
III). focus.

• A.I and II.
• B.I and III.
• C.I, II and III.

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The measure of central tendency which is sensitive to extreme scores on the higher or lower end of a distribution is the:

• A.mode.
• B.mean.
• C.median.

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