Which of the Following Statements Is NOT True

question 44

Multiple Choice

Which of the following statements is NOT true?

• A)Investments rated below BBB- are known as high quality bonds.
• B)Investment grade securities should include those with a bond rating of AA.
• C)A "fallen angel" is a bond that at one time was an investment grade security,but whose bond ratings has subsequently dropped.
• D)Another colorful term for non-investment grade bonds is "junk bonds."

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Definitions:

Cost-to-Retail Ratio

A method used in retail to calculate the estimated ending inventory value at retail prices by dividing the cost of goods available for sale by the retail price of the goods.

Net Markups

The overall increase in the selling price of goods, net of any reductions or markdowns, calculated over the cost price.

Ending Inventory

The total value of all inventory in stock at the end of an accounting period, calculated using the cost of goods sold formula.

FIFO Retail Inventory Method

An inventory valuation method which assumes that items purchased or produced first are sold first, thereby computing inventory based on the most recent prices.