Exam 9: Finance: Acquiring and Using Funds to Maximize Value

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

__________is a spontaneous financing granted by sellers when they deliver goods and services to customers without requiring immediate payment.

Return-on-equity indicates how much net income a firm earned per share of common stock outstanding.

Tunebeak, a fast food service chain, wants to introduce a new product. However, it lacks the financial support required to promote its product. Therefore, it sells its accounts receivables from its customers to a financing firm and is able to invest in the promotion of its product. Which of the following short-term financing options is being used by Tunebeak in the given scenario?

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

Dora works for PowTran Corp. Her primary responsibilities include managing the firm's working capital and analyzing long-term investment opportunities for the firm. Dora is most likely a part of the firm's _____ team.

Which of the following is a difference between liquidity ratios and leverage ratios?

Rumerion Inc., a shoe manufacturing company, buys its raw materials from Coy Kaymilford, a footwear raw material supplier. Coy Kaymilford allows Rumerion Inc. to make the payment at a later date, as opposed to immediate payment. Which of the following short-term financing options is being used by Rumerion in the given scenario?

Which of the following statements is true of a socially responsible firm?

One of the major sources of equity financing for corporations is _____.

Tinix is a well-established petrochemical company that holds excellent credit ratings in the market. It provides short-term financial capital to other big firms by issuing promissory notes that are collateralized by physical assets. Which of the following short-term financing options is being offered by Tinix in the given scenario?

An advantage of offering lenient credit terms is that it can help a firm:

Lean inventory policies can be ineffective in a firm, although they do not leave the firm vulnerable to supply disruptions.

_____ are safe and highly liquid assets that many firms list with their cash holdings on their balance sheet.

Renita works as a freelancer. She wants to start her own business, but she does not have the required funding. To meet the working capital for her business, she takes a short-term loan from a bank. The bank agrees to provide her funding up to $50,000, as and when she needs it. However, she can repay the amount immediately or over a pre-specified period of time. Which of the following short-term financing sources does Renita utilize to fund her business in the given scenario?

Kitsure, a cosmetics company, was able to sell 20 percent more than its estimated sales in a year. The company was able to acquire its investment along with a higher turnover for its shareholders. Which of the following financial ratios provides the measure of Kitsure's earnings?

In the context of accounting for the time value of money, discount rate remains constant in a specified number of time periods.

Certificate of deposit is an interest-earning deposit that requires the funds to remain deposited for a fixed term.

Reesa Mork is a multinational corporation that has good credit ratings. It issues promissory notes to other companies. Based on the given information in the scenario, it appears that Reesa Mork uses _____ as a short-term financing option to other companies.

Which of the following statements best describes a money market mutual fund?