Finance
Which of the following would be considered a liability
Accounts payable
What is the basic accounting equation
Assets=liabilities + owners equity
A debt security issues by a state or local government
Bond
The approximate sales volume required for a business to cover costs, below which production would be unprofitable and above which would be profitable is called the
Breakeven point
A wise spending plan, often called a _______ is the foundation for achieving personal financial goals
Budget
Is the value all investors have in a company
Capital
Which of the following would be considered a nondeposit institution
Check cashing outlet
Is an asset promised by a business to a creditor if repayment of a loan isn't completed
Collateral
A place where raw materials, oil, livestock, metals and gold are sold
Commodity market
Investing in a variety of assets is called
Diversification
The science of decision making about the allocation of scarce resources is the definition of
Economics
A partnership is a business owned by 3 or more people
False
As more people desire a certain investment its value will likely decrease
False
Cash, accounts recievable, and inventory are all examples of liquid assets
False
Financial claims on a company's resources come from both creditors and owners
False
Inflation is the place where stocks are traded
False
______ markets are contracts negotiated for the sale of products at a future date
Futures
Provides a view of the financial changes in a business that have occurred during a specific period of time
Income statement
The financial statement provides a view of the financial changes in a business that has occurred during a specific period of time
Income statement
An item vistas $100 last year and this year is $104
Inflation
Refers to business transactions involving companies that do business in one state
Intrastate commerce
A measure commonly used to determine how many times inventory is sold and replaced is called
Inventory turnover
What a business owes to others
Liabilities
Refers to the ease and speed with which an investment can be converted into cash
Liquidity
The ease and speed of which an investment can be converted into cash is called
Liquidity
The price at which equal number of products will be produced and purchased is called the
Market price
What is the balance point between supply and demand
Market price
The level of economic decisions related to the choices of individuals and businesses is know as
Markets
Financial records reflect the use of one stable currency; even if financial transactions may have been completed using multiple currencies
Monetary unit
______markets specialize in buying and selling financial instruments for short periods of a year or less
Money
Which is the following provides loans for purchasing a home
Mortgage company
Which of the following is an example of a deposit institution
None of the above
A limited liability company combines features of which two forms of business ownership
Partnership and corporation
Which of the following is used to raise new capital for an organization
Primary offering
The amount of money a business borrows is called the
Principal
Which of the following is an example of a fixed expense
Rent
Profits earned by a company that are not paid to shareholders as dividends are called
Retained earnings
The three common sources of funds for most businesses are
Revenue , investor funds, borrowing
The tax you pay when you purchase an iPod
Sales tax
The most common form of business organization in the US is
Sole proprietorship
Organized exchange of the ownership shares of public corporation occurs at a
Stock market
Which of the following is not part of the US free enterprise economy
Strong government controls
If a country exports more than it imports it is said to have a
Trade surplus
When a country exports more than it imports
Trade surplus
A bond is a financial instrument that obligates the issuer to pay the bond holder the principal plus interest at the end of the designated period
True
A government uses tax dollars to protect citizens, consumers and businesses
True
CEO, COO, CFO are all positions within a corporation
True
Cash is not the equivalent of profit
True
Companies are expected to record revenues when they are actually earned and not when payment is received
True
Economics is the science of decision making about the allocation of scarce resources
True
Equity financing involves the use of borrowed money to buy assets
True
Having large amounts of inventory on hand can lead to high storage costs and out of date material
True
If a business owner wants to know whether the amount of available cash for her business is increasing or decreasing, she would probably consult the cash flow statement
True
If liabilities increase in relation to the value of assets, owners equity decreases
True
Investments with high financial risk also offer the opportunity for greater financial return
True
Labor costs, production materials, and utilities are all considered variable costs
True
Pressure on a corporation management to maintain a high rate of return for investors sometimes leads to poor financial decisions
True
Supple is the quantity of a product and the demand is the amount that individuals want to satisfy their wants and needs
True
The most common type of debt security is stock
True
The simple interest formula is I=PRT
True
You should review your personal financial plan at least once per year and perhaps more often based on your personal situation
True