Question 1

________ 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 2

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 3

A company can use a(n)________ to identify all sources of revenue and coordinate the spending of those funds throughout the coming year.

Accepted Answer

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

Question 4

Revenue obtained through selling assets is an example of an external source of income.

Accepted Answer

A) True 
 B)False

Question 5

Cost of capital is the average rate of interest a firm pays on its combination of debt and equity.

Accepted Answer

A) True 
 B)False

Question 6

A lease is an agreement to use an asset in exchange for regular payment.

Accepted Answer

A) True 
 B)False

Question 7

DS Bank is a bank specialized in buying shares of ownership from firms that want to sell it to investors.The bank sells the shares to investors on the company's behalf.DS Bank is a(n)________.

Accepted Answer

A)  financial renovator 
B)  controller 
C)  treasurer 
D)  underwriter 
E)  non-banking firm 
A)  financial renovator 
B)  controller 
C)  treasurer 
D)  underwriter 
E)  non-banking firm

Question 8

________ can be exchanged at the investor's option for a certain number of shares of the corporation's common stock.

Accepted Answer

A)  Collateralized bonds 
B)  Protected bonds 
C)  Bills of exchange 
D)  Debentures 
E)  Convertible bonds 
A)  Collateralized bonds 
B)  Protected bonds 
C)  Bills of exchange 
D)  Debentures 
E)  Convertible bonds

Question 9

Gordon Consultants is planning to raise money by leasing a building that it owns.What do you think are the components of a lease agreement? Draft a lease agreement for Gordon Consultants.

Accepted Answer

A lease is an agreement to use an asset

Question 10

Which of the following is an internal source for obtaining funds for business?

Accepted Answer

A)  issuing corporate bonds 
B)  unsecured loans 
C)  factoring 
D)  commercial papers 
E)  selling assets to obtain revenue 
A)  issuing corporate bonds 
B)  unsecured loans 
C)  factoring 
D)  commercial papers 
E)  selling assets to obtain revenue

Question 11

Debentures are backed by specific assets that will be given to bondholders if the borrowed amount is not repaid.

Accepted Answer

A) True 
 B)False

Question 12

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 13

Budget reflects expected revenues,cash receipts,and outlays.

Accepted Answer

A) True 
 B)False

Question 14

Factoring refers to lending a lump sum of cash via a promissory note or on-demand access without accepting any other securities.

Accepted Answer

A) True 
 B)False

Question 15

________ 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 16

Albert is the financial manager of a manufacturing firm.Albert has been an integral part of the firm ever since it started business in 2006.Albert's job has transformed over the years and every year he is responsible for creating a budget to identify all sources of raising funds and coordinates the spending of those funds throughout the company.This budget is an example of a(n)________ budget.

Accepted Answer

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

Question 17

________ is the technique of increasing the rate of return on an investment by financing it with borrowed funds.

Accepted Answer

A)  Returns projection 
B)  Budgeting 
C)  Leverage 
D)  Forecasting 
E)  Financial projection 
A)  Returns projection 
B)  Budgeting 
C)  Leverage 
D)  Forecasting 
E)  Financial projection

Question 18

Choose an operational unit of your business (for example,the marketing department in a firm)and construct an operating budget for the unit.Make necessary assumptions and list all the assumptions that you are making.

Accepted Answer

Operating budget is a budget that identi

Question 19

Explain the concept of venture capital.

Accepted Answer

Venture capitalists are a key source of

Question 20

When using ________,a company starts the year with a budget based on revenue and cost assumptions made at that point but then reviews economic performance every month or every quarter to see whether the budget needs to be modified as the year progresses.

Accepted Answer

A)  hedge-based budgeting 
B)  scenario planning 
C)  rolling forecasts 
D)  product segmentation 
E)  judgmental forecasting 
A)  hedge-based budgeting 
B)  scenario planning 
C)  rolling forecasts 
D)  product segmentation 
E)  judgmental forecasting

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

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

A company can use a(n)________ to identify all sources of revenue and coordinate the spending of those funds throughout the coming year.

Revenue obtained through selling assets is an example of an external source of income.

Cost of capital is the average rate of interest a firm pays on its combination of debt and equity.

A lease is an agreement to use an asset in exchange for regular payment.

DS Bank is a bank specialized in buying shares of ownership from firms that want to sell it to investors.The bank sells the shares to investors on the company's behalf.DS Bank is a(n)________.

________ can be exchanged at the investor's option for a certain number of shares of the corporation's common stock.

Gordon Consultants is planning to raise money by leasing a building that it owns.What do you think are the components of a lease agreement? Draft a lease agreement for Gordon Consultants.

Which of the following is an internal source for obtaining funds for business?

Debentures are backed by specific assets that will be given to bondholders if the borrowed amount is not repaid.

Budget reflects expected revenues,cash receipts,and outlays.

Factoring refers to lending a lump sum of cash via a promissory note or on-demand access without accepting any other securities.

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

________ is the technique of increasing the rate of return on an investment by financing it with borrowed funds.

Choose an operational unit of your business (for example,the marketing department in a firm)and construct an operating budget for the unit.Make necessary assumptions and list all the assumptions that you are making.

Explain the concept of venture capital.

When using ________,a company starts the year with a budget based on revenue and cost assumptions made at that point but then reviews economic performance every month or every quarter to see whether the budget needs to be modified as the year progresses.

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

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

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

A company can use a(n)________ to identify all sources of revenue and coordinate the spending of those funds throughout the coming year.

Revenue obtained through selling assets is an example of an external source of income.

Cost of capital is the average rate of interest a firm pays on its combination of debt and equity.

A lease is an agreement to use an asset in exchange for regular payment.

DS Bank is a bank specialized in buying shares of ownership from firms that want to sell it to investors.The bank sells the shares to investors on the company's behalf.DS Bank is a(n)________.

________ can be exchanged at the investor's option for a certain number of shares of the corporation's common stock.

Gordon Consultants is planning to raise money by leasing a building that it owns.What do you think are the components of a lease agreement? Draft a lease agreement for Gordon Consultants.

Which of the following is an internal source for obtaining funds for business?

Debentures are backed by specific assets that will be given to bondholders if the borrowed amount is not repaid.

Budget reflects expected revenues,cash receipts,and outlays.

Factoring refers to lending a lump sum of cash via a promissory note or on-demand access without accepting any other securities.

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

________ is the technique of increasing the rate of return on an investment by financing it with borrowed funds.

Choose an operational unit of your business (for example,the marketing department in a firm)and construct an operating budget for the unit.Make necessary assumptions and list all the assumptions that you are making.

Explain the concept of venture capital.

When using ________,a company starts the year with a budget based on revenue and cost assumptions made at that point but then reviews economic performance every month or every quarter to see whether the budget needs to be modified as the year progresses.

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