CMFAS M4A Exam Free Trial Set Two

Every time a bond market rate comes below the stated rate, the bond will need to sell at a premium in order for buyers to be interested. So, the core difference between the two of them is the buyer purchasing the bond for more than the par value.

The security that is determined by the Yield to maturity (YTM) are bonds because of the total return anticipated on a bond and the bond is held until it matures.

Limited liability is both an advantage and disadvantage for a corporation because the condition by which shareholders are legally responsible for the debts of a company only to the extent of the nominal value of their shares.

When a mortgage attached recorded in a partnership for financial statement purposes, calculates the capital balance when property contributed has a mortgage result in the FV of the Asset being netted against the Liability.

Bond markets are very important in finance and the reasons behind these are various, however, one of the most important ones might be that these markets are an important source of financing in the nations.

Correlation involves only two investments and not more than this. In finance, is called correlation when two investments move in relation to one another.

The debenture bonds by definition in finance is the bond that is not secured by any collateral.

The main difference is between the assets which are shared at its distributed date and its carry amount on the company’s books.

Dividend imputation is a corporate tax system in which some of the tax paid by a company may be attributed, or imputed, to the shareholders by way of a tax credit to reduce the income tax payable on a distribution.

Each time a company cannot meet its financial obligations is called that financial distress.

Analyzing a variety of investment opportunities is best done by analysing the net present value.

When a company is overvalued, the investors need to adjust the debt-equity ratio by borrowing personally by investing instead in the shares of an unlevered company.

In other words, private equity typically refers to investment funds only for new companies.

There are several areas of main-line finance disciplines. However, the correct one from below is corporate finance.

There are numerous advantages of having a sole proprietorship but some of the main ones are easy control over the business, a less expensive business organization, simple tax reporting and minimal reporting requirements.

One of the main advantages of having the market share difference between the two companies is that investors will enter the market to take advantage of the arbitrage opportunity. This way will force the values of the two companies to be the same.

Corporate financial decisions depend on how assets are to be funded, includes dividend decisions such as paying shareholder or retain funds for internal growth. The investment decision is another important aspect in determining the asset profile of the business.

There are some differences between corporations and trusts and one of the main ones is that the last one provides greater tax advantages.

A budget is a financial plan for a defined period, often one year which is established based on the available income of each individual.

Sometimes banks get shortage regarding particular foreign currencies. When this happens, the banks purchase that currency from other banks. This process is called the interbank market.