Question 1

Burn rate is a major concern when preparing a(n)________ budget.

Accepted Answer

A)  start-up 
B)  operating 
C)  capital 
D)  project 
E)  master 
A)  start-up 
B)  operating 
C)  capital 
D)  project 
E)  master

Question 2

________ is an arrangement in which a financial institution makes money available for use at any time after the loan has been approved.

Accepted Answer

A)  Corporate bond 
B)  Factoring 
C)  Line of credit 
D)  Lease agreement 
E)  Commercial paper 
A)  Corporate bond 
B)  Factoring 
C)  Line of credit 
D)  Lease agreement 
E)  Commercial paper

Question 3

________ is an SEC-required document that discloses required information about the company,its finances,and its plans for using the money it hopes to raise.

Accepted Answer

A)  Memorandum of agreement 
B)  Chairperson's report 
C)  Prospectus 
D)  Articles of association 
E)  Memorandum of association 
A)  Memorandum of agreement 
B)  Chairperson's report 
C)  Prospectus 
D)  Articles of association 
E)  Memorandum of association

Question 4

Long-term loans on real estate are called mortgages.

Accepted Answer

A) True 
 B)False

Question 5

Which of the following is the best example of an external source for obtaining funds for business?

Accepted Answer

A)  revenue from selling assets 
B)  funds from shareholders 
C)  interest from deposits 
D)  issuing corporate bonds 
E)  earnings from investments 
A)  revenue from selling assets 
B)  funds from shareholders 
C)  interest from deposits 
D)  issuing corporate bonds 
E)  earnings from investments

Question 6

USS Agro is a firm that markets agricultural products.The firm procures supplies from agricultural cooperatives across the world.The firm forms agreements with the cooperatives to provide supplies at a fixed price in the future to protect them against changing prices.This is an example of ________.

Accepted Answer

A)  zero-based budgeting 
B)  inventorying 
C)  liquidation 
D)  hedging 
E)  standardization 
A)  zero-based budgeting 
B)  inventorying 
C)  liquidation 
D)  hedging 
E)  standardization

Question 7

4Learning is a firm that sells learning solutions to customers.The company identifies the training needs of organizations and designs flash-based online training programs for them.The company has recently received an order to create product training platforms for an electronic manufacturer.The company creates a budget specifically for this order to determine the pricing of the project.This budget is an example of a ________ budget.

Accepted Answer

A)  operating 
B)  capital 
C)  project 
D)  master 
E)  start-up 
A)  operating 
B)  capital 
C)  project 
D)  master 
E)  start-up

Question 8

Shareholders of a firm have prior claims on the firm's assets.

Accepted Answer

A) True 
 B)False

Question 9

Compare and contrast credit cards and trade credit.

Accepted Answer

Credit cards are one of the most expensi

Question 10

Boston Ceramics is a manufacturer of semiconductors.The company produces such parts as ceramic machine components.The company wants to raise $ 15 million to launch operations in a new country.The company decides to fund the launch entirely by using debt financing.Which of the following observations,if true,would most strengthen this financing decision?

Accepted Answer

A)  Research has revealed that the company has high chance of succeeding in the new market. 
B)  The company is looking to obtain funding that does not have a specific maturity period. 
C)  The management feels that the new project is a very risky affair. 
D)  The management wants to establish discretionary costs for the new project. 
E)  Tax rates are high in the new market and the company wants to minimize taxable income. 
A)  Research has revealed that the company has high chance of succeeding in the new market. 
B)  The company is looking to obtain funding that does not have a specific maturity period. 
C)  The management feels that the new project is a very risky affair. 
D)  The management wants to establish discretionary costs for the new project. 
E)  Tax rates are high in the new market and the company wants to minimize taxable income.

Question 11

Term loans have maturities between three months to one year.

Accepted Answer

A) True 
 B)False

Question 12

A group of six entrepreneurs are starting a paper manufacturing unit.The owners have contributed $ 20,000 and have availed a long-term loan of $15,000.Use zero-based budgeting to create a launch budget for this firm.Make necessary assumptions and list all the assumptions that you are making.

Accepted Answer

A launch budget identifies the money a n

Question 13

Rex Associates has a poor credit rating and is finding it difficult to obtain loans.In order to fund a new project,the company decides to let out one of its buildings to a bank.The company obtains funds in return from the bank.This is an example of ________.

Accepted Answer

A)  unsecured lending 
B)  factoring 
C)  leasing 
D)  long-term lending 
E)  short-term lending 
A)  unsecured lending 
B)  factoring 
C)  leasing 
D)  long-term lending 
E)  short-term lending

Question 14

Explain the importance of considering interest fluctuations in financial planning.

Accepted Answer

Regardless of how financially solid a co

Question 15

Short-term financing is financing that will be repaid within one year.

Accepted Answer

A) True 
 B)False

Question 16

Which of the following is a source of long-term debt financing?

Accepted Answer

A)  corporate bond 
B)  trade credit 
C)  credit card 
D)  factoring 
E)  commercial paper 
A)  corporate bond 
B)  trade credit 
C)  credit card 
D)  factoring 
E)  commercial paper

Question 17

Private equity refers to ________.

Accepted Answer

A)  shares that are owned by institutions rather than individuals 
B)  ownership assets that aren't publicly traded 
C)  preference shares issued by a corporation 
D)  shares that are traded in stock exchanges 
E)  shares that are owned by individuals rather than institutions 
A)  shares that are owned by institutions rather than individuals 
B)  ownership assets that aren't publicly traded 
C)  preference shares issued by a corporation 
D)  shares that are traded in stock exchanges 
E)  shares that are owned by individuals rather than institutions

Question 18

________ are unsecured bonds,backed only by the corporation's promise to pay.

Accepted Answer

A)  Convertible bonds 
B)  Protected bonds 
C)  Bills of exchange 
D)  Debentures 
E)  Non-convertible bonds 
A)  Convertible bonds 
B)  Protected bonds 
C)  Bills of exchange 
D)  Debentures 
E)  Non-convertible bonds

Question 19

Prime interest rate is the ________.

Accepted Answer

A)  lowest rate of interest that banks charge for short-term loans 
B)  average rate of interest charged by banks on their customers 
C)  interest rate that the Federal Reserve charges on loans 
D)  interest that the Federal Reserve pays for deposits 
E)  interest rate banks charge to their least creditworthy customers 
A)  lowest rate of interest that banks charge for short-term loans 
B)  average rate of interest charged by banks on their customers 
C)  interest rate that the Federal Reserve charges on loans 
D)  interest that the Federal Reserve pays for deposits 
E)  interest rate banks charge to their least creditworthy customers

Question 20

A ________ is a planning and control tool that reflects expected revenues,operating expenses,and cash receipts and outlays.

Accepted Answer

A)  data structure 
B)  financial plan 
C)  cash flow 
D)  budget 
E)  capital structure 
A)  data structure 
B)  financial plan 
C)  cash flow 
D)  budget 
E)  capital structure

Burn rate is a major concern when preparing a(n)________ budget.

________ is an arrangement in which a financial institution makes money available for use at any time after the loan has been approved.

________ is an SEC-required document that discloses required information about the company,its finances,and its plans for using the money it hopes to raise.

Long-term loans on real estate are called mortgages.

Which of the following is the best example of an external source for obtaining funds for business?

USS Agro is a firm that markets agricultural products.The firm procures supplies from agricultural cooperatives across the world.The firm forms agreements with the cooperatives to provide supplies at a fixed price in the future to protect them against changing prices.This is an example of ________.

Shareholders of a firm have prior claims on the firm's assets.

Compare and contrast credit cards and trade credit.

Term loans have maturities between three months to one year.

A group of six entrepreneurs are starting a paper manufacturing unit.The owners have contributed $ 20,000 and have availed a long-term loan of $15,000.Use zero-based budgeting to create a launch budget for this firm.Make necessary assumptions and list all the assumptions that you are making.

Rex Associates has a poor credit rating and is finding it difficult to obtain loans.In order to fund a new project,the company decides to let out one of its buildings to a bank.The company obtains funds in return from the bank.This is an example of ________.

Explain the importance of considering interest fluctuations in financial planning.

Short-term financing is financing that will be repaid within one year.

Which of the following is a source of long-term debt financing?

Private equity refers to ________.

________ are unsecured bonds,backed only by the corporation's promise to pay.

Prime interest rate is the ________.

A ________ is a planning and control tool that reflects expected revenues,operating expenses,and cash receipts and outlays.

Developing a Business Mindset

Understanding Basic Economics

The Global Marketplace

Business Ethics and Corporate Social Responsibility

Forms of Ownership

Entrepreneurship and Small Business Ownership

Management Roles, Functions, and Skills

Organization and Teamwork

Production Systems

Employee Motivation

Human Resources Management

Labor Relations

The Art and Science of Marketing

Product and Pricing Strategies

Distribution and Marketing Logistics

Customer Communication

Financial Information and Accounting Concepts

Financial Markets and Investment Strategies

The Money Supply and Banking Systems

Filters

Exam 18: Financial Management

Burn rate is a major concern when preparing a(n)________ budget.

________ is an arrangement in which a financial institution makes money available for use at any time after the loan has been approved.

________ is an SEC-required document that discloses required information about the company,its finances,and its plans for using the money it hopes to raise.

Long-term loans on real estate are called mortgages.

Which of the following is the best example of an external source for obtaining funds for business?

USS Agro is a firm that markets agricultural products.The firm procures supplies from agricultural cooperatives across the world.The firm forms agreements with the cooperatives to provide supplies at a fixed price in the future to protect them against changing prices.This is an example of ________.

Shareholders of a firm have prior claims on the firm's assets.

Compare and contrast credit cards and trade credit.

Term loans have maturities between three months to one year.

A group of six entrepreneurs are starting a paper manufacturing unit.The owners have contributed $ 20,000 and have availed a long-term loan of $15,000.Use zero-based budgeting to create a launch budget for this firm.Make necessary assumptions and list all the assumptions that you are making.

Rex Associates has a poor credit rating and is finding it difficult to obtain loans.In order to fund a new project,the company decides to let out one of its buildings to a bank.The company obtains funds in return from the bank.This is an example of ________.

Explain the importance of considering interest fluctuations in financial planning.

Short-term financing is financing that will be repaid within one year.

Which of the following is a source of long-term debt financing?

Private equity refers to ________.

________ are unsecured bonds,backed only by the corporation's promise to pay.

Prime interest rate is the ________.

A ________ is a planning and control tool that reflects expected revenues,operating expenses,and cash receipts and outlays.

Developing a Business Mindset

Understanding Basic Economics

The Global Marketplace

Business Ethics and Corporate Social Responsibility

Forms of Ownership

Entrepreneurship and Small Business Ownership

Management Roles, Functions, and Skills

Organization and Teamwork

Production Systems

Employee Motivation

Human Resources Management

Labor Relations

The Art and Science of Marketing

Product and Pricing Strategies

Distribution and Marketing Logistics

Customer Communication

Financial Information and Accounting Concepts

Financial Markets and Investment Strategies

The Money Supply and Banking Systems

Filters