Finance

Which one of the following best illustrates that the management of a firm is adhering to the goal of financial management?

An increase in the market value per share

Which business form is best suited to raising large amounts of capital?

Corporation

Which one of the following is an unintended result of the Sarbanes-Oxley Act?

Corporations delisting from major exchanges

Operating Cash Flow=

EBIT + Depreciation - Taxes

Which of the following parties are considered stakeholders of a firm?

Employees and the government

Change in NWC=

Ending NWC - Beginning NWC

A business formed by two or more individuals who each have unlimited liability for all of the firm's business debts is called a:

General Partnership

Which one of the following is an agency cost?

Hiring outside accountants to audit the company's financial statements

Which one of the following questions is a working capital management decision?

How much inventory should be on hand for immediate sale?

Which one of the following questions is least likely to be addressed by financial managers?

How should a product be marketed?

The growth of both sole proprietorships and partnerships is frequently limited by the firm's:

Inability to raise cash

Which one of the following statements is correct?

Income from both sole proprietorships and partnerships that is taxable is treated as individual income.

addition to retained earnings=

Net Income - Dividends

EBT=

Net income/ (1- Tax Rate)

Which one of the following is a cash flow from a corporation into the financial markets?

Payment of loan Interest

Which one of the following functions should be the responsibility of the controller rather than the treasurer?

Processing Costs reports

Which one of the following grants an individual the right to vote on behalf of a shareholder?

Proxy

Shareholder A sold shares of Maplewood Cabinets stock to Shareholder B. The stock is listed on the NYSE. This trade occurred in which one of the following?

Secondary, auction market

Financial managers should primarily focus on the interests of:

Shareholders

Which one of the following statements concerning a sole proprietorship is correct?

The life of a sole proprietorship is limited.

A business created as a distinct legal entity and treated as a legal "person" is called a(n):

corporation

NWC=

current assets - current liabilities

Corporate bylaws:

determine how a corporation regulates itself.

dividends per share

dividends/shares

One disadvantage of the corporate form of business ownership is the:

double taxation of distributed profits.

Net Capital Spending=

ending net fixed assets - beginning net fixed assets + depreciation

A limited partnership:

has at least one partner who has unlimited liability for all of the partnership's debts.

cash flow to creditors=

interest paid - net new borrowing* *(LTDend-LTDbeg)

Decisions made by financial managers should primarily focus on increasing the:

market value per share of outstanding stock.

Earnings per share=

net income/shares outstanding

Working capital management decisions include determining:

the minimum level of cash to be kept in a checking account.

The primary advantage of being a limited partner is:

the partner's maximum loss is limited to their capital investment.

When evaluating the timing of a project's projected cash flows, a financial manager is analyzing:

when each cash flow is expected to occur.