final test

In its role as lender to member banks, the Federal Reserve is called the:

Bankers Bank

Dylan is interested in building her interpersonal skills. She should focus on all EXCEPT:

Choose a comfortable workplace like a bed

The ratio of net profit to the number of shares of common stock outstanding is called the:

Earnings per share (ESP)

In college, students should take selecting a major lightly because they will change majors and careers at least six times.

False

Independent accountants who serve organizations and individuals on a fee basis are called private accountants.

False

Lines of credit are short-term loans that are secured by collateral.

False

Positive behavior is making a conscious effort to think with an optimistic attitude and to anticipate positive outcomes.

False

The major disadvantage of debt financing is the inability to deduct interest expenses for income tax purposes.

False

A ________ makes short-term loans for which the borrower puts up tangible assets (such as an auto, inventory, machinery, or property) as security.

Finance company

_______ management is the art and science used to determine the most effective ways to acquire and use funds to achieve the firm's goals.

Financial

In finance, _______ is the potential for loss.

Financial risk

The difference between net sales and cost of goods sold is:

Gross Profit

A(n) _________ is a summary of what a company has earned and spent over a given period.

Income Statement

When conflicts occur, try the K-I-N-D technique. Where I stands for:

Informed

The ratios that are of special interest to the firm's creditors and measure the firm's ability to pay short-term debts as they come due are called ______ ratios.

Liquidity ratios

Financial managers often shift temporary funds from checking accounts to ___________ securities to earn higher interest rates.

Marketable

_______ are temporary investments of excess cash in bonds and stock that can readily be converted into cash.

Marketable securities

A(n) _______ is a method or process worked out in advance that leads to the achievement of some goal.

Plan

An accountant who has a bachelor's degree, passes a test prepared by the professional organization AICPA, and has a certain number of years of on-the-job training becomes a:

Private accountants or financial managers

A(n) _______ is a summary of the money flowing into and out of a firm.

Statement of cash flows

Business loans available from commercial banks with terms generally five to twelve years and secured or unsecured are called _______ loans.

Term

Thrift institutions were formed specifically to encourage household savings and to:

To make Home Mortgage Loans

If you are trying to study but get distracted by all of the things you need to do, take time to make a to-do list.

True

It is important to apply thought, creativity, and discipline to all the interrelated phases of our lives.

True

The benefits from capital expenditures extend beyond one year's time.

True

In selecting the right job, one should start with consideration to "FACTS" where "F" stands for:

fit

Money is anything that is acceptable as payment for goods and services.

true

National banks must belong to the Federal Reserve System and must carry FDIC insurance.

true

The Federal Deposit Insurance Corporation (FDIC) is an independent, quasi-public corporation backed by the full faith and credit of the United States government.

true

The usual expression of the accounting equation is Assets = Liabilities + Owner's Equity.

true

The first step in an effective team is to have goals that are clear, realistic, and supported by each team member and that parallel the larger organization goal.

True

Weeds, sand, and paper clips would not make good mediums of exchange because they lack the key characteristic of

scarcity

The primary goal of the financial manager is to:

to maximize the value of the firm to its owners.

A current asset is one that can or will be converted into cash within one year.

true

Equity is the owner's investment in the business.

true

Financial management is the art and science of managing a firm's money so the firm can meet its goals.

true

________ are debts to be paid within twelve months.

short term

All careers have which of the following in common?

you need to have a basic understanding of business.

Capital budgeting:

analyze long-term projects and select those that offer the best returns while maximizing the firm's value.

Financial intermediation is the process in which:

channels funds between third parties with a surplus and those with a lack of funds

The major advantage of debt financing is the:

deductibility of interest expense for income tax purposes, which lowers its overall cost

Which of the following is the second step of the planning process?

Acquire Knowledge

The operating license for a commercial bank is called a(n):

Bank Charter

The Federal Deposit Insurance Corporation (FDIC) insures deposits in commercial banks. The FDIC was created by the:

Congress

________ are specific repayment conditions as to how long customers have to pay bills and the amount of cash discount allowed.

Credit terms

When conflicts occur, try the K-I-N-D technique. Where D stands for:

Definite

Money market deposit accounts and certificates of deposit are officially called _______ deposits.

demand deposits

Accounting is the process of collecting, recording, classifying, summarizing, reporting, and analyzing the financial condition of an organization.

false

The final figure or bottom line on an income statement is called the net revenue.

false

The three tools used by the Federal Reserve to manage monetary policy are reserve requirements, prime rate, and the discount rate

false

U.S. banks have had no trouble competing successfully against foreign banks.

false

To ensure accuracy and consistency in the way financial information is reported, accountants follow rules known as:

generally accepted accounting principles (GAAP)

Competing against foreign banks can be difficult for U.S. banks because:

Banks in other nations are often subject to fewer regulations than U.S. banks

A secured loan requires that the borrower pledge specific assets to secure the loan. These assets are called:

Collateral or security

Accounting involves the _______ of the financial activities for firms.

Collecting, recording, Classifying, summarizing, reporting, and analyzing

________ stock is a security that represents an ownership interest in a corporation and has voting rights.

Common