Question 1

________ financial statements reflect past performance and are usually prepared on a quarterly and annual basis.

Accepted Answer

A)  Chronological 
B)  Ad-hoc 
C)  Historical 
D)  Concurrent 
E)  Pro forma 
A)  Chronological 
B)  Ad-hoc 
C)  Historical 
D)  Concurrent 
E)  Pro forma

Question 2

The pro forma ________ provides a firm a sense of how its activities will affect its ability to meet its short-term liabilities and how its finances will evolve over time.

Accepted Answer

A)  balance sheet 
B)  statement of cash flows 
C)  income statement 
D)  expense statement 
E)  statement of owners' equity 
A)  balance sheet 
B)  statement of cash flows 
C)  income statement 
D)  expense statement 
E)  statement of owners' equity

Question 3

Match the financial objective with its correct definition.

Accepted Answer

A)  stability - the overall health of the financial structure of the firm, particularly as it relates to its debt-to-equity ratio 
B)  profitability - how productively a firm utilizes its assets 
C)  liquidity - a company's ability to make a profit 
D)  efficiency - a company's ability to meet its short-term obligations 
E)  profitability - the overall health of the financial structure of the firm, particularly as it relates to its debt-to-equity ratio 
A)  stability - the overall health of the financial structure of the firm, particularly as it relates to its debt-to-equity ratio 
B)  profitability - how productively a firm utilizes its assets 
C)  liquidity - a company's ability to make a profit 
D)  efficiency - a company's ability to meet its short-term obligations 
E)  profitability - the overall health of the financial structure of the firm, particularly as it relates to its debt-to-equity ratio

Question 4

Match the financial term with its proper definition.

Accepted Answer

A)  Forecasts - depict relationships between items on a firm's financial statements 
B)  Forecasts - written reports that quantitatively describe a firm's financial health 
C)  Budget - itemized forecasts of a company's income, expenses, and capital needs 
D)  Financial ratios - written report that quantitatively describes a firm's financial health 
E)  Financial statements - an estimate of a firm's future income and expenses 
A)  Forecasts - depict relationships between items on a firm's financial statements 
B)  Forecasts - written reports that quantitatively describe a firm's financial health 
C)  Budget - itemized forecasts of a company's income, expenses, and capital needs 
D)  Financial ratios - written report that quantitatively describes a firm's financial health 
E)  Financial statements - an estimate of a firm's future income and expenses

Question 5

The statement of cash flows summarizes the changes in a firm's cash position for a specified period of time and details why the change occurred.

Accepted Answer

A) True 
 B)False

Question 6

Real estate, buildings, equipment and furniture are classified as ________ assets on a company's balance sheet.

Accepted Answer

A)  intermediate term 
B)  fixed 
C)  other 
D)  permanent 
E)  current 
A)  intermediate term 
B)  fixed 
C)  other 
D)  permanent 
E)  current

Question 7

Stability is a company's ability to meet its short-term financial obligations.

Accepted Answer

A) True 
 B)False

Question 8

According to the textbook, the most practical way to interpret or make sense of a firm's historical financial statements is through ________.

Accepted Answer

A)  profit analysis 
B)  regression analysis 
C)  the preparation of pro forma financial statements 
D)  ratio analysis 
E)  percentage analysis 
A)  profit analysis 
B)  regression analysis 
C)  the preparation of pro forma financial statements 
D)  ratio analysis 
E)  percentage analysis

Question 9

________ depict relationships between items on a firm's financial statements.

Accepted Answer

A)  Financial proportions 
B)  Fiscal relations 
C)  Fiscal projections 
D)  Monetary balances 
E)  Financial ratios 
A)  Financial proportions 
B)  Fiscal relations 
C)  Fiscal projections 
D)  Monetary balances 
E)  Financial ratios

Question 10

Which of the following selections correctly matches the financial statement with its description?

Accepted Answer

A)  Income statement - tells how much a firm is making or losing 
B)  Income statement - depicts the structure of a firm's assets and liabilities 
C)  Balance sheet - shows where a firm's cash is coming from 
D)  Balance sheet - tells how much a firm is making or losing 
E)  Statement of cash flows - depicts the structure of a firm's assets and liabilities 
A)  Income statement - tells how much a firm is making or losing 
B)  Income statement - depicts the structure of a firm's assets and liabilities 
C)  Balance sheet - shows where a firm's cash is coming from 
D)  Balance sheet - tells how much a firm is making or losing 
E)  Statement of cash flows - depicts the structure of a firm's assets and liabilities

Question 11

Which of the following statements about pro forma financial statements is incorrect?

Accepted Answer

A)  Pro forma financial statements are projections for future periods based on forecasts. 
B)  Pro forma financial statements are typically completed for two to three years into the future. 
C)  Pro forma financial statements are required by the SEC. 
D)  Most companies consider their pro forma financial statements to be confidential and reveal them to outsiders only on a "need to know basis." 
E)  Pro forma financial statements are strictly planning tools. 
A)  Pro forma financial statements are projections for future periods based on forecasts. 
B)  Pro forma financial statements are typically completed for two to three years into the future. 
C)  Pro forma financial statements are required by the SEC. 
D)  Most companies consider their pro forma financial statements to be confidential and reveal them to outsiders only on a "need to know basis." 
E)  Pro forma financial statements are strictly planning tools.

Question 12

Susan Howard owns a seafood restaurant in Naples, Florida. She is currently owed $21,000 by a corporation that she catered a series of meetings for and $3,000 on an overdue account. Amanda has $24,000 in ________.

Accepted Answer

A)  accounts receivable 
B)  inventory 
C)  accounts collectable 
D)  accounts obtainable 
E)  accounts payable 
A)  accounts receivable 
B)  inventory 
C)  accounts collectable 
D)  accounts obtainable 
E)  accounts payable

Question 13

Historical financial statements reflect past performance and are usually prepared on a quarterly and annual basis.

Accepted Answer

A) True 
 B)False

Question 14

A(n) ________ is a snapshot of a company's assets, liabilities, and owners' equity at a specific point in time.

Accepted Answer

A)  income statement 
B)  statement of cash flows 
C)  effectiveness statement 
D)  balance sheet 
E)  efficiency statement 
A)  income statement 
B)  statement of cash flows 
C)  effectiveness statement 
D)  balance sheet 
E)  efficiency statement

Question 15

The pro forma income statement shows the projected flow of cash into and out of the company during a specified period.

Accepted Answer

A) True 
 B)False

________ financial statements reflect past performance and are usually prepared on a quarterly and annual basis.

The pro forma ________ provides a firm a sense of how its activities will affect its ability to meet its short-term liabilities and how its finances will evolve over time.

Match the financial objective with its correct definition.

Match the financial term with its proper definition.

The statement of cash flows summarizes the changes in a firm's cash position for a specified period of time and details why the change occurred.

Real estate, buildings, equipment and furniture are classified as ________ assets on a company's balance sheet.

Stability is a company's ability to meet its short-term financial obligations.

According to the textbook, the most practical way to interpret or make sense of a firm's historical financial statements is through ________.

________ depict relationships between items on a firm's financial statements.

Which of the following selections correctly matches the financial statement with its description?

Which of the following statements about pro forma financial statements is incorrect?

Susan Howard owns a seafood restaurant in Naples, Florida. She is currently owed $21,000 by a corporation that she catered a series of meetings for and $3,000 on an overdue account. Amanda has $24,000 in ________.

Historical financial statements reflect past performance and are usually prepared on a quarterly and annual basis.

A(n) ________ is a snapshot of a company's assets, liabilities, and owners' equity at a specific point in time.

The pro forma income statement shows the projected flow of cash into and out of the company during a specified period.

Introduction to Entrepreneurship

Recognizing Opportunities and Generating Ideas

Feasibility Analysis

Developing an Effective Business Model

Industry and Competitor Analysis

Writing a Business Plan

Preparing the Proper Ethical and Legal Foundation

Building a New-Venture Team

Getting Financing or Funding

Unique Marketing Issues

The Importance of Intellectual Property

Preparing for and Evaluating the Challenges of Growth

Strategies for Firm Growth

Franchising

Filters

Exam 8: Assessing a New Venture's Financial Strength and Viability

________ financial statements reflect past performance and are usually prepared on a quarterly and annual basis.

The pro forma ________ provides a firm a sense of how its activities will affect its ability to meet its short-term liabilities and how its finances will evolve over time.

Match the financial objective with its correct definition.

Match the financial term with its proper definition.

The statement of cash flows summarizes the changes in a firm's cash position for a specified period of time and details why the change occurred.

Real estate, buildings, equipment and furniture are classified as ________ assets on a company's balance sheet.

Stability is a company's ability to meet its short-term financial obligations.

According to the textbook, the most practical way to interpret or make sense of a firm's historical financial statements is through ________.

________ depict relationships between items on a firm's financial statements.

Which of the following selections correctly matches the financial statement with its description?

Which of the following statements about pro forma financial statements is incorrect?

Susan Howard owns a seafood restaurant in Naples, Florida. She is currently owed $21,000 by a corporation that she catered a series of meetings for and $3,000 on an overdue account. Amanda has $24,000 in ________.

Historical financial statements reflect past performance and are usually prepared on a quarterly and annual basis.

A(n) ________ is a snapshot of a company's assets, liabilities, and owners' equity at a specific point in time.

The pro forma income statement shows the projected flow of cash into and out of the company during a specified period.

Introduction to Entrepreneurship

Recognizing Opportunities and Generating Ideas

Feasibility Analysis

Developing an Effective Business Model

Industry and Competitor Analysis

Writing a Business Plan

Preparing the Proper Ethical and Legal Foundation

Building a New-Venture Team

Getting Financing or Funding

Unique Marketing Issues

The Importance of Intellectual Property

Preparing for and Evaluating the Challenges of Growth

Strategies for Firm Growth

Franchising

Filters