BCOR 2204 Finance Quiz 1 with Verified Answers
financial services
managerial finance involves...
profit maximization as the "goal" of the
firm is BAD because...
Pro-active ethics program is expected to
result in...
The Board of Directors is responsible
for...
The agency problem may result ...
BCOR 2204 Finance Quiz 1 with Verified Answers
concerned with design and delivery of
financial services advice and financial products to individ-
uals, businesses, and governments
tasks such as budgeting, financial fore-
managerial finance involves... casting, cash management, and funds
procurement
profit maximization as the "goal" of the profit maximization DOES NOT consider
firm is BAD because... risk
a positive corporate image and in-
Pro-active ethics program is expected to creased respect, a reduction in risk, and
result in... enhanced cash flow resulting in an in-
crease in share price
The Board of Directors is responsible
approving strategic goals and plans
for...
The agency problem may result from a
job security
manager's concerns about...
The profitability ratios are... primarily used as measures of return
1 and 2
current ratios are usually between
-high current ratio: a lot of money
indicate firm is experiencing stockout
Inventory Turnover Ratio may...
and lost sales
the activity, or liquidity, of a firm's stock of
Inventory Turnover Ratio measures...
goods
the efficiency with which the firm uses its
Total Asset Turnover indicates...
assets to generate sales
Example: Gross profit margin is inferior
the high cost of goods sold
to the industry standard. This may have
GPM: sales-COGS
resulted from...
What is a cash inflow? a decrease in accounts receivable
the relationships between a firm's sales
An external sales forecast is based on
and certain key economic indicators
.
such as GDP and consumer confidence
the sales forecast
, BCOR 2204 Finance Quiz 1 with Verified Answers
The key input to the short-term financial
planning process is...
The key input to any cash budget is... the sales forecast
If a firm expects short-term cash surplus-
short-term investments
es, it can plan .
the primary purpose in preparing pro for-
for profit planning
ma financial statements is...
Pro forma statements are... projected financial statements
the key inputs for preparing pro forma sales forecast for the coming year and
income statements using the simplified financial statements for the preceding
approaches are the... year
the percentage-of-sales method of
preparing pro forma income statements All costs are variable
assumes that
In a period of rising utilities past cost
and expense ratios (percent-of-sales
UNDERSTATE retained earnings and
method), when preparing pro forma fi-
OVERSTATE the financing needed
nancial statements and planning financ-
ing, will tend to .
External financing required arrange for a loan
the science and art of how individuals
Finance and firms raise, allocate, and invest mon-
ey
concerns the duties of the financial man-
managerial finance
ager in a business
The amount earned during the period
on behalf of each outstanding share of
common stock, calculated by dividing the
Earnings Per Share (EPS) period's total earnings available for the
firm's common stockholders by the num-
ber of shares of common stock outstand-
ing.
the chance that actual outcomes may
risk
differ from those expected
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