The chart displays the:

• A.Arithmetic mean of each computer complaint.
• B.Relative frequency of each computer complaint.
• C.Median of each computer complaint.
• D.Absolute frequency of each computer complaint.

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In creating a risk-based plan, which of the following best describes a top-down approach to understanding business processes?

• A.Analyzing the organization's strategic plan where the business processes are defined.
• B.Analyzing the organization's objectives and identifying the processes needed to achieve the objectives.
• C.Identifying the processes at the activity level.
• D.Identifying the risks affecting the organization, the objectives, and then the processes concerned.

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Which of the following is not a required element of a contract?

• A.Legality.
• B.Consideration.
• C.Legal capacity.
• D.A writing.

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The economic value of an entity will rise following an increase in:

• A.Net cash flow.
• B.Systematic risk.
• C.Unsystematic risk.
• D.The discount rate.

Correct Answer: A

Net cash flow represents the numerator in the formula used to derive the value of the entity. Therefore, the economic value of the entity will increase as net cash flow increases. Presented below are partial year-end financial statement data for entities.

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For the year just ended the entity has times-interest-earned of:

• A.3.375 times
• B.6.75 times
• C.7.75 times
• D.9.5 times

Correct Answer: C

The TIE ratio is a leverage ratio_ It emphasizes the ability to pay interest expense. The ratio equals profit before interest and taxes divided by interest

C:\Documents and Settings\usernwz1\Desktop\1.PNG RST Corporation's Income Statement for Year 5 and Year 6


The market value of RST's ordinary stock at the end of Year 6 was US $100.00 per share.

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