A Company Had Average Total Assets of $1,660,000,total Cash Flows

question 96

Multiple Choice

A company had average total assets of $1,660,000,total cash flows of $1,320,000,cash flows from operations of $205,000,and cash flows from financing of $750,000.The cash flow on total assets ratio equals:

• A)45.2%.
• B)22.0%.
• C)11.65%.
• D)12.3%.
• E)79.5%.

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Definitions:

All Cash Deal

A type of transaction where the purchase of a company or asset is made entirely with cash, without the use of stocks or other forms of financing.

Incremental Value

The additional value generated from a particular action or decision, compared to what would have occurred without it.

Equity-Financed

A method of raising capital by selling company shares to investors as opposed to incurring debt.

Incremental Value

Refers to the additional value generated by undertaking a certain action, decision, or investment, compared to doing nothing.