WGU C214 OA FINANCIAL MANAGEMENT EXAM & STUDY GUIDE QUESTIONS AND ANSWERS
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WGU C214 OA FINANCIAL MANAGEMENT
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WGU C214 OA FINANCIAL MANAGEMENT
WGU C214 OA FINANCIAL MANAGEMENT EXAM & STUDY GUIDE QUESTIONS AND ANSWERS
The market rate of return is 6%. The face value of the bond is $1,000, the coupon rate 10% with annual compounding, and the bond matures in 10 years. What is the value of the bond?
● $748
● $1,000
● $1,248
● $1,2...
WGU C214 OA FINANCIAL MANAGEMENT
EXAM & STUDY GUIDE QUESTIONS AND
ANSWERS
The market rate of return is 6%. The face value of the bond is $1,000, the coupon
rate 10% with annual compounding, and the bond matures in 10 years. What is
the value of the bond?
● $748
● $1,000
● $1,248
● $1,294
#1 what is one way a firm maximizes shareholder value
by avoiding investments that costs more money than they bring in
By switching inventory methods
by reducing the firm's labor force
by outsourcing the production of the firm's core product
shareholder value = avoiding
#1 The stock price of a company increases and the market is deemed efficient.
What assumption can be made?
A. A new, patented, product was introduced to the market.
B. New machinery was purchased with a useful life of 20 years.
C. Management is optimizing its resources and operating efficiently.
D. Management hired new employees and invested in a training program.
#2 what do investors, entrepreneurs, and other market participants rely on the
Securities and Exchange Commission SEC to do
WEAVE together a regulatory network that offers stability to US investors who
trade on a global level
provide regulatory oversight on all exchange globally
form a regulatory network that offers protection to foreign investors who trade on
a global level.
,determine the safety and efficiency of global investments by US and foreign
investors.
2. Which statement is true about how the global market affects the U.S.
A. A bad options trade executed by a foreign subsidiary of a Wall Street bank will
affect layoffs overseas.
B. A Bad derivatives trade executed by a foreign subsidiary of a Wall Street bank
will affect layoffs overseas.
C. American investors and fund managers make decisions based on financial
reporting standards developed and
financial statements audited overseas.
D. Foreign investors and fund managers make decisions based on financial
reporting standards developed and
financial statements audited overseas.
#3 what is one of the two basic types of financial instruments
mutual funds,
stocks,
options
money markets
3. What are secondary markets?
A. Markets where securities are traded subsequent to the initial offering.
B. Markets were securities are issued for the first time.
C. Markets were securities are issued through a competitive sale.
D. Markets where securities are issued through a negotiated sale.
#4 why is it a challenge for a fund manager to review financial statements
from other countries?
because the US generally accepted accounting principles and the International
Financial Reporting Standards VARY
Because the US Financial Accounting Standards Board is in the beginning
stages. of working with the International Accounting Standards Board on
converging reporting standards
,Because the US Financial Accounting Standards Board does not work with the
International Accounting Standards Board on mitigating differences in reporting
standards
because the US Financial Accounting Standards Board and the International
Accounting Standards Board abandoned the project to convert financial reporting
rules
#5 what do the content and structure of an income statement report
the revenues and expenses for a period of time
the expenses and liabilities at a point in time,
the assets and expenses for a period of time
the Assets Liabilities and Equity at a point in time.
income tax report = revenue and expense
5. What do the content and structure of a balance sheet report?
The assets , liabilities , and equity at a point in time
#6 What is the basis used to compute a company’s income tax expense?
1- Net operating income
2- pretax accounting income
3- TAXABLE INCOME
4- Taxes payable
income tax expense is calculated by multiplying taxable income by the effective tax
rate.me tax expense
#6 what is true when income for tax purposes is HIGHER than accounting
income.
actual income taxes payable when will be lower than accounting income tax
expense.
actual income tax payable will be HIGHER than accounting income tax expense.
Accounting income tax expense is the same as actual income tax payable.
actual income taxes payable will be the same as accounting income taxes
expense
#7 Selected Data for 20x2 for ABC Inc
Net income $1,000
, depreciation expense 300
change in operating assets 600
change in net profit plant and equipment 5000
changes in long term liabilities 1000
dividends paid 200
What is the firm's cash flow from operating activities using the data above
700 in flow
400 in flow
1000 in flow
1300 in flow
What is the firm’s cash flow from financing, using the data above?
Net Income $1000
Depreciation Expense $300
Change in operating assets $600
Change in net profit plant $5000
Change in long-term Liabilities $1000
Dividends Paid $200
A. $200 outflow
B. $800 outflow
C. $800 inflow
D. $1,000 inflow
#8 a company reported an increase in accounts payable of $2,000. For the current
year half of this amount is expected to be paid next period.
How will this change in accounts payable be reported on the statement statement
of cash flows?
The change will increase cash flow from operations by 1000.
The change will increase cash flow from operations by 2000.
The change will decrease cash flows from operations by 2000.
The change will decrease cash flows from operations by 1000
8. A company reported an increase in accounts payable of $2,000 for the current year.
Half of this amount is expected to be paid next period. How will this change in accounts
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