Postest FI 7

When return on capital is positive, the company is A) growing in value. B) losing value. C) low on cash. D) paying out dividends.

A) growing in value.

Decisions about financing refer to the A) accounts receivable. B) acquisition of funds. C) administration of assets. D) accounting department

B) acquisition of funds.

The cash conversion cycle should be A) at equilibrium. B) as short as possible. C) as long as possible. D) on an upward trend.

B) as short as possible.

The finance function is usually responsible for which of the following processes: A) Budgeting B) Manufacturing C) Operations D) Research

A) Budgeting

How does the finance function relate to company spending? A) It plans and controls spending. B) It produces reports about spending. C) It spends on investments only. D) It does not relate to spending.

A) It plans and controls spending.

Assets a company already owns and can use to finance a new venture are called A) equity. B) dividends. C) return on capital. D) accounts payable.

A) equity.

Accounting is distinct from finance because its main focus is on A) recordkeeping activities. B) money management decisions. C) administration of assets. D) acquisition of funds.

A) recordkeeping activities.

To keep communication flowing with other departments, the finance function depends on A) accounts receivable. B) information systems. C) marketing. D) production.

B) information systems.

Finance is the business function that involves managing A) information. B) money. C) marketing. D) production

B) money.

A company's current balance of assets and liabilities falls under the focus of A) return on capital. B) working capital management. C) capital investment decisions. D) the cash conversion cycle.

B) working capital management.

Which of the following is a key component of managing working capital: A) Financing B) Capital budgeting C) Cash conversion cycle D) Capital structure

C) Cash conversion cycle

Which of the following is a capital investment decision: A) How to manage cash flow B) How to handle accounts payable C) How to finance investments D) How to manage inventory

C) How to finance investments

Money the business owes is known as A) equity. B) assets. C) accounts payable. D) accounts receivable.

C) accounts payable.

The administration of assets refers to decisions about A) accounting. B) spending. C) investments. D) financing.

C) investments.

The finance function would definitely be involved in a decision regarding A) public relations and publicity. B) personal selling. C) new business projects and strategies. D) hiring.

C) new business projects and strategies.

The finance function ensures that the company's financial goals are A) acceptable to the marketing department. B) related to product development. C) easy to accomplish. D) in line with organizational priorities.

D) in line with organizational priorities.

Which of the following is a measure of how well a business generates cash flow: A) Accounts receivable B) Capital structure C) Accounts payable D) Return on capital

D) Return on capital

Money owed to the business is known as A) equity. B) assets. C) accounts payable. D) accounts receivable.

D) accounts receivable.

Determining which projects a business should invest in is known as A) return on capital. B) the cash conversion cycle. C) capital structuring. D) capital budgeting.

D) capital budgeting.

The goals of the finance function are to ensure profitability and to A) advertise products. B) manufacture raw materials. C) give out information. D) reduce risks.

D) reduce risks.