Question 1

Accounts payable are spontaneous secured sources of short-term financing that arise from the normal operations of the firm.

Accepted Answer

A) True 
 B)False

Question 2

Short-term self-liquidating loans are intended to

Accepted Answer

A)  finance capital assets. 
B)  finance merger/acquisition activity. 
C)  recapitalize the firm. 
D)  cover seasonal peaks in financing caused by inventory and receivable buildups. 
A)  finance capital assets. 
B)  finance merger/acquisition activity. 
C)  recapitalize the firm. 
D)  cover seasonal peaks in financing caused by inventory and receivable buildups.

Question 3

A __________is a type of loan made to a business by a commercial bank. This type of loan is madewhen the borrower needs additional funds for a short period but does not believe the need willcontinue or reoccur on a seasonal basis.

Accepted Answer

A)  revolving credit agreement 
B)  short-term self-liquidating loan 
C)  single payment note 
D)  line of credit 
A)  revolving credit agreement 
B)  short-term self-liquidating loan 
C)  single payment note 
D)  line of credit

Question 4

Appropriate collateral for a loan secured under a trust receipt inventory loan is

Accepted Answer

A)  bananas. 
B)  recreation vehicles. 
C)  pencils. 
D)  drill bits. 
A)  bananas. 
B)  recreation vehicles. 
C)  pencils. 
D)  drill bits.

Question 5

By offering credit to customers, the firm may

Accepted Answer

A)  decrease its investment in accounts payable. 
B)  decrease the cost of goods purchased. 
C)  increase the price of the good to cover its costs. 
D)  decrease its investment in accounts receivable. 
A)  decrease its investment in accounts payable. 
B)  decrease the cost of goods purchased. 
C)  increase the price of the good to cover its costs. 
D)  decrease its investment in accounts receivable.

Question 6

When a firm stretches accounts payable without hurting its credit rating, the cost of foregoing thecash discount is

Accepted Answer

A)  immaterial. 
B)  reduced. 
C)  increased. 
D)  unaffected. 
A)  immaterial. 
B)  reduced. 
C)  increased. 
D)  unaffected.

Question 7

In a line of credit agreement, a bank may retain the right to revoke the line if any major changes occur in the firm's financial condition or operations.

Accepted Answer

A) True 
 B)False

Question 8

Most commercial paper has maturities ranging from

Accepted Answer

A)  one year to three years. 
B)  seven days to 30 days. 
C)  three days to 270 days. 
D)  six months to one year. 
A)  one year to three years. 
B)  seven days to 30 days. 
C)  three days to 270 days. 
D)  six months to one year.

Accounts payable are spontaneous secured sources of short-term financing that arise from the normal operations of the firm.

Short-term self-liquidating loans are intended to

A __________is a type of loan made to a business by a commercial bank. This type of loan is madewhen the borrower needs additional funds for a short period but does not believe the need willcontinue or reoccur on a seasonal basis.

Appropriate collateral for a loan secured under a trust receipt inventory loan is

By offering credit to customers, the firm may

When a firm stretches accounts payable without hurting its credit rating, the cost of foregoing thecash discount is

In a line of credit agreement, a bank may retain the right to revoke the line if any major changes occur in the firm's financial condition or operations.

Most commercial paper has maturities ranging from

Overview of Corporate Finance

Financial Statements, Cash Flows, and Taxes

Financial Statement Analysis

Financial Planning and Forecasting

Financial Markets, Institutions, and Securities

Time Value of Money

Risk and Return

Valuation of Financial Securities

The Cost of Capital

Leverage and Capital Structure

Dividend Policy

Capital Budgeting: Principles and Techniques

Dealing With Project Risk and Other Topics in Capital Budgeting

Working Capital and Management of Current Assets

Lease Financing: Concepts and Techniques

Corporate Securities, Derivatives, and Swaps

Mergers and Acquisitions, and Business Failure

International Corporate Finance

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Exam 15: Management of Current Liabilities

Accounts payable are spontaneous secured sources of short-term financing that arise from the normal operations of the firm.

Short-term self-liquidating loans are intended to

A __________is a type of loan made to a business by a commercial bank. This type of loan is madewhen the borrower needs additional funds for a short period but does not believe the need willcontinue or reoccur on a seasonal basis.

Appropriate collateral for a loan secured under a trust receipt inventory loan is

By offering credit to customers, the firm may

When a firm stretches accounts payable without hurting its credit rating, the cost of foregoing thecash discount is

In a line of credit agreement, a bank may retain the right to revoke the line if any major changes occur in the firm's financial condition or operations.

Most commercial paper has maturities ranging from

Overview of Corporate Finance

Financial Statements, Cash Flows, and Taxes

Financial Statement Analysis

Financial Planning and Forecasting

Financial Markets, Institutions, and Securities

Time Value of Money

Risk and Return

Valuation of Financial Securities

The Cost of Capital

Leverage and Capital Structure

Dividend Policy

Capital Budgeting: Principles and Techniques

Dealing With Project Risk and Other Topics in Capital Budgeting

Working Capital and Management of Current Assets

Lease Financing: Concepts and Techniques

Corporate Securities, Derivatives, and Swaps

Mergers and Acquisitions, and Business Failure

International Corporate Finance

Filters