Question 1

Financial analysis and planning involve all of the following EXCEPT

Accepted Answer

A)  controlling the data processing activities. 
B)  transforming data into a form that can be used to monitor the firm's financial position. 
C)  determining the additional financing needs. 
D)  evaluating the need for increased or reduced productive capacity. 
A)  controlling the data processing activities. 
B)  transforming data into a form that can be used to monitor the firm's financial position. 
C)  determining the additional financing needs. 
D)  evaluating the need for increased or reduced productive capacity.

Question 2

Which of the following legal forms of organization's income is NOT taxed under individual incometax rate?

Accepted Answer

A)  corporations 
B)  partnerships 
C)  limited partnerships 
D)  sole proprietorships 
A)  corporations 
B)  partnerships 
C)  limited partnerships 
D)  sole proprietorships

Question 3

The treasurer typically handles the cost and financial accounting.

Accepted Answer

A) True 
 B)False

Question 4

Hardwood Furniture Limited sold $1,225,000 worth of tables, chairs and other furniture last year.During that time period, the company collected $975,755 for those items and paid $407,844 for thematerials used in producing the furniture they sold. What was Hardwood's net cash flow for last year?

Accepted Answer

A)  $1,225,000 
B)  $975,755 
C)  $817,156 
D)  $567,911 
A)  $1,225,000 
B)  $975,755 
C)  $817,156 
D)  $567,911

Question 5

A stock exchange is a secondary financial market.

Accepted Answer

A) True 
 B)False

Question 6

The controller is commonly responsible for

Accepted Answer

A)  financial accounting. 
B)  managing credit activities. 
C)  managing cash. 
D)  financial planning. 
A)  financial accounting. 
B)  managing credit activities. 
C)  managing cash. 
D)  financial planning.

Question 7

The financial manager's financing decisions determine

Accepted Answer

A)  both the mix and the type of assets and liabilities found on the firm's balance sheet. 
B)  the proportion of the firm's earnings to be paid as dividend. 
C)  both the mix and the type of assets found on the firm's balance sheet. 
D)  the most appropriate mix of short-term and long-term financing. 
A)  both the mix and the type of assets and liabilities found on the firm's balance sheet. 
B)  the proportion of the firm's earnings to be paid as dividend. 
C)  both the mix and the type of assets found on the firm's balance sheet. 
D)  the most appropriate mix of short-term and long-term financing.

Question 8

Agency costs include all of the following EXCEPT

Accepted Answer

A)  opportunity costs. 
B)  monitoring expenditures. 
C)  bonding and structuring expenses. 
D)  cost of goods sold. 
A)  opportunity costs. 
B)  monitoring expenditures. 
C)  bonding and structuring expenses. 
D)  cost of goods sold.

Question 9

The treasurer's focus tends to be more external, while the controller's focus is more internal.

Accepted Answer

A) True 
 B)False

Question 10

The president or chief executive officer is elected by the firm's stockholders and has ultimate authority to guide corporate affairs and make general policy.

Accepted Answer

A) True 
 B)False

Question 11

The Economic Value Added (EVA) is the difference between the cost of funds used to finance an investment and its after-tax operating profits.

Accepted Answer

A) True 
 B)False

Question 12

By concentrating on cash flows within the firm the financial manager should be able to

Accepted Answer

A)  control expenses. 
B)  avoid insolvency. 
C)  prepare tax returns. 
D)  speak authoritatively to stockholders. 
A)  control expenses. 
B)  avoid insolvency. 
C)  prepare tax returns. 
D)  speak authoritatively to stockholders.

Question 13

The major disadvantage of the sole proprietorship and partnership is the unlimited liability of the business owners.

Accepted Answer

A) True 
 B)False

Question 14

A major weakness of a partnership is

Accepted Answer

A)  access to capital markets. 
B)  low organizational costs. 
C)  limited liability. 
D)  difficulty liquidating or transferring ownership. 
A)  access to capital markets. 
B)  low organizational costs. 
C)  limited liability. 
D)  difficulty liquidating or transferring ownership.

Question 15

The amount earned during the accounting period on each outstanding share of common stock iscalled

Accepted Answer

A)  net profits after taxes. 
B)  earnings per share. 
C)  net income. 
D)  a common stock dividend. 
A)  net profits after taxes. 
B)  earnings per share. 
C)  net income. 
D)  a common stock dividend.

Question 16

Which of the following risk-return statements is true?

Accepted Answer

A)  an investment in a Government of Canada bond is more risky than an investment in a publicly traded company, such as Nortel Networks 
B)  rational investors require a lower return for exposing themselves to risk 
C)  in order to increase the return expected from any kind of investment, we must increase our exposure to risk 
D)  all of the above are true 
A)  an investment in a Government of Canada bond is more risky than an investment in a publicly traded company, such as Nortel Networks 
B)  rational investors require a lower return for exposing themselves to risk 
C)  in order to increase the return expected from any kind of investment, we must increase our exposure to risk 
D)  all of the above are true

Question 17

A high eps does not necessarily translate into a high stock price.

Accepted Answer

A) True 
 B)False

Question 18

The financial manager's investment decisions determine

Accepted Answer

A)  both the mix and the type of liabilities found on the firm's balance sheet. 
B)  both the mix and the type of assets and liabilities found on the firm's balance sheet. 
C)  both the mix and the type of short-term and long-term financing. 
D)  both the mix and the type of assets found on the firm's balance sheet. 
A)  both the mix and the type of liabilities found on the firm's balance sheet. 
B)  both the mix and the type of assets and liabilities found on the firm's balance sheet. 
C)  both the mix and the type of short-term and long-term financing. 
D)  both the mix and the type of assets found on the firm's balance sheet.

Question 19

The CEO of a large corporation takes his family on a cruise charging the cost to his business account; this is considered an agency cost.

Accepted Answer

A) True 
 B)False

Question 20

Hardwood Furniture Limited sold $1,225,000 worth of tables, chairs and other furniture last year.During that time period, the company collected $975,755 for those items and paid $407,844 for thematerials used in producing the furniture they sold. What was Hardwood's net profit for last year?

Accepted Answer

A)  $1,225,000 
B)  $975,755 
C)  $567,911 
D)  $817,156 
A)  $1,225,000 
B)  $975,755 
C)  $567,911 
D)  $817,156

Financial analysis and planning involve all of the following EXCEPT

Which of the following legal forms of organization's income is NOT taxed under individual incometax rate?

The treasurer typically handles the cost and financial accounting.

Hardwood Furniture Limited sold $1,225,000 worth of tables, chairs and other furniture last year.During that time period, the company collected $975,755 for those items and paid $407,844 for thematerials used in producing the furniture they sold. What was Hardwood's net cash flow for last year?

A stock exchange is a secondary financial market.

The controller is commonly responsible for

The financial manager's financing decisions determine

Agency costs include all of the following EXCEPT

The treasurer's focus tends to be more external, while the controller's focus is more internal.

The president or chief executive officer is elected by the firm's stockholders and has ultimate authority to guide corporate affairs and make general policy.

The Economic Value Added (EVA) is the difference between the cost of funds used to finance an investment and its after-tax operating profits.

By concentrating on cash flows within the firm the financial manager should be able to

The major disadvantage of the sole proprietorship and partnership is the unlimited liability of the business owners.

A major weakness of a partnership is

The amount earned during the accounting period on each outstanding share of common stock iscalled

Which of the following risk-return statements is true?

A high eps does not necessarily translate into a high stock price.

The financial manager's investment decisions determine

The CEO of a large corporation takes his family on a cruise charging the cost to his business account; this is considered an agency cost.

Hardwood Furniture Limited sold $1,225,000 worth of tables, chairs and other furniture last year.During that time period, the company collected $975,755 for those items and paid $407,844 for thematerials used in producing the furniture they sold. What was Hardwood's net profit for last year?

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

Management of Current Liabilities

Lease Financing: Concepts and Techniques

Corporate Securities, Derivatives, and Swaps

Mergers and Acquisitions, and Business Failure

International Corporate Finance

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Exam 1: Overview of Corporate Finance

Financial analysis and planning involve all of the following EXCEPT

Which of the following legal forms of organization's income is NOT taxed under individual incometax rate?

The treasurer typically handles the cost and financial accounting.

Hardwood Furniture Limited sold $1,225,000 worth of tables, chairs and other furniture last year.During that time period, the company collected $975,755 for those items and paid $407,844 for thematerials used in producing the furniture they sold. What was Hardwood's net cash flow for last year?

A stock exchange is a secondary financial market.

The controller is commonly responsible for

The financial manager's financing decisions determine

Agency costs include all of the following EXCEPT

The treasurer's focus tends to be more external, while the controller's focus is more internal.

The president or chief executive officer is elected by the firm's stockholders and has ultimate authority to guide corporate affairs and make general policy.

The Economic Value Added (EVA) is the difference between the cost of funds used to finance an investment and its after-tax operating profits.

By concentrating on cash flows within the firm the financial manager should be able to

The major disadvantage of the sole proprietorship and partnership is the unlimited liability of the business owners.

A major weakness of a partnership is

The amount earned during the accounting period on each outstanding share of common stock iscalled

Which of the following risk-return statements is true?

A high eps does not necessarily translate into a high stock price.

The financial manager's investment decisions determine

The CEO of a large corporation takes his family on a cruise charging the cost to his business account; this is considered an agency cost.

Hardwood Furniture Limited sold $1,225,000 worth of tables, chairs and other furniture last year.During that time period, the company collected $975,755 for those items and paid $407,844 for thematerials used in producing the furniture they sold. What was Hardwood's net profit for last year?

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

Management of Current Liabilities

Lease Financing: Concepts and Techniques

Corporate Securities, Derivatives, and Swaps

Mergers and Acquisitions, and Business Failure

International Corporate Finance

Filters