Exam 9: Finance: Acquiring Using Funds to Maximize Value

Cash budgets normally cover a one-year period and show projected cash inflows and outflows for each month.

In addition to contributions from owners, firms can also raise long-term funds by:

Connink, a software development firm, invested on developing new products from the company's earnings from the previous year. Which of the following sources of long-term funds is being used by Connink in the given scenario?

A manufacturing firm does not necessarily need an inventory of parts and materials to assemble its products.

_____ measure how effectively an organization uses its resources to generate net income.

Which of the following is a similarity between angel investors and venture capitalists?

A _____ can help a firm evaluate how much internal financing (funds generated by earnings) will be available for a planning period.

Which of the following statements is true of U.S. Treasury bills (T-bills)?

Mezzinzi Bank offers loans to companies in the form of bonds. The companies who apply for these loans can repay the amount over a prolonged period of time. Which of the following financing options is being offered by Mezzinzi Bank in the given scenario?

In the context of debt financing, if a firm invests the borrowed funds profitably, the use of debt can substantially improve the _____ to the shareholders.

Dimitium National Bank is well known for lending money to companies who need it as quickly as possible. Any company that takes money from the bank is required to return the amount within six months at an interest at a rate of 12 percent. Which of the following short-term financing options is being offered by Dimitium National Bank in the given scenario?

Unlike the debt in a firm's capital structure, the equity in a firm's capital structure:

Which of the following statements is true of money market mutual funds?

_____ measures the income earned per dollar invested by the stockholders of a firm.

Miranti Nex, an automobile company, plans to invest in developing a hybrid car. It refrains from using loans from other firms and instead uses its own monetary resources to fund the project. Which of the following sources of long-term funds is being used by Miranti Nex in the given scenario?

Omnimenium, an automobile company, incurred a debt of $20 million for the fiscal year of 2016. The company used that money with an additional $20 million of its own to buy out a rival company. The ratio of the company's debt to its investment is 0.5. The given scenario illustrates the analysis of _____.

Explain the advantages and disadvantages of equity financing.

Because it is normally unsecured, commercial paper is only offered by firms with no credit ratings.

Maude Shade, a fashion apparel manufacturing company, wants to invest in research before finalizing the production of its proposed product. In order to do so, it approaches Ruemen Bank and takes a loan of $80,000 in the form of bonds. Which of the following financing options is being used by Maude Shade in the given scenario?

A factor is a restriction lenders impose on borrowers as a condition of providing long-term debt financing.