Question 1

Implicit agency costs do not have a direct expense associated with them, but they harm shareholders anyway.

Accepted Answer

A) True 
 B)False

Question 2

Which of the following are considered to be major financial management functions?

Accepted Answer

A) financial planning and analysis 
B) asset management 
C) raising funds 
D) all of the above 
A) financial planning and analysis 
B) asset management 
C) raising funds 
D) all of the above

Question 3

Financial statements that must be included in the annual report include the:

Accepted Answer

A) income statement 
B) balance sheet 
C) statement of cash flows 
D) all of the above 
E) none of the above 
A) income statement 
B) balance sheet 
C) statement of cash flows 
D) all of the above 
E) none of the above

Question 4

The statement of retained earnings includes all of the following accounts within the statement except:

Accepted Answer

A) interest expense 
B) net profits after taxes 
C) preferred stock dividends 
D) stock repurchases 
E) all of the above are included 
A) interest expense 
B) net profits after taxes 
C) preferred stock dividends 
D) stock repurchases 
E) all of the above are included

Question 5

For corporations, the principal-agent relationship usually refers to the relationship between:

Accepted Answer

A) buyers-sellers 
B) owners-managers 
C) manager-customer 
D) owner-bankers 
A) buyers-sellers 
B) owners-managers 
C) manager-customer 
D) owner-bankers

Question 6

Top finance officers in a corporation may include:

Accepted Answer

A) treasurer 
B) chief financial officer 
C) controller 
D) all the above 
E) none of the above 
A) treasurer 
B) chief financial officer 
C) controller 
D) all the above 
E) none of the above

Question 7

A limited partnership is comprised of:

Accepted Answer

A) only limited partners 
B) only general partners 
C) both general and limited partners 
D) both partners and proprietors 
A) only limited partners 
B) only general partners 
C) both general and limited partners 
D) both partners and proprietors

Question 8

Which of the following are required to file annual reports with the Securities and Exchange Commission?

Accepted Answer

A) proprietorships 
B) partnerships 
C) public corporations 
D) all the above 
A) proprietorships 
B) partnerships 
C) public corporations 
D) all the above

Question 9

Ningbo Steel had year end 2011 and 2012 retained earnings balances of $6,000,000 and $6,600,000 respectively.  The firm paid $200,000 of dividends in 2011.  Based on this information, Ningbo Steel’s net profit after taxes in 2011 was:

Accepted Answer

A) 	$200,000 
B) 	$600,000 
C) 	$620,000 
D) 	$6,200,000 
E) 	none of the above 
A) 	$200,000 
B) 	$600,000 
C) 	$620,000 
D) 	$6,200,000 
E) 	none of the above

Question 10

A business should begin with a vision or mission statement that is consistent with the planned overall strategy.

Accepted Answer

A) True 
 B)False

Question 11

Managerial lines of authority, legal responsibility and the allocation of income and risk are directly related to the form the organization takes.

Accepted Answer

A) True 
 B)False

Question 12

Which of the following statements is false?

Accepted Answer

A) working capital represents assets needed to carry out the normal operations of the business. 
B) current liabilities that reflect amounts owed but not yet due on the date of the balance sheet are called accruals.Wages payable are part of a firm's accounts payable, 
C) because of accrual accounting, a firm's net income over some period is not necessarily the same as its cash flows. 
D) all the above statements are correct. 
A) working capital represents assets needed to carry out the normal operations of the business. 
B) current liabilities that reflect amounts owed but not yet due on the date of the balance sheet are called accruals.Wages payable are part of a firm's accounts payable, 
C) because of accrual accounting, a firm's net income over some period is not necessarily the same as its cash flows. 
D) all the above statements are correct.

Question 13

The balance sheet is a statement of a company's financial position over an accounting period.

Accepted Answer

A) True 
 B)False

Question 14

The Public Company Accounting Oversight Board (PCAOB) is

Accepted Answer

A) 	a not-for-profit corporation that oversees managers of public corporations 
B) 	a not-for-profit corporation that oversees CEOs of public corporations 
C) 	a for-profit corporation that oversees managers of public corporations. 
D) 	a not-for-profit corporation that oversees auditors of public corporations 
E) 	a not-for-profit corporation that oversees managers of public corporations. 
A) 	a not-for-profit corporation that oversees managers of public corporations 
B) 	a not-for-profit corporation that oversees CEOs of public corporations 
C) 	a for-profit corporation that oversees managers of public corporations. 
D) 	a not-for-profit corporation that oversees auditors of public corporations 
E) 	a not-for-profit corporation that oversees managers of public corporations.

Question 15

One advantage of the corporate form of organization is the ease with which ownership may be transferred.

Accepted Answer

A) True 
 B)False

Question 16

The goal of any firm should be the maximization of sales.

Accepted Answer

A) True 
 B)False

Question 17

Agency costs may include:

Accepted Answer

A) costs of auditing financial statements 
B) liability insurance for board of directors 
C) management perks 
D) all the above 
E) none of the above 
A) costs of auditing financial statements 
B) liability insurance for board of directors 
C) management perks 
D) all the above 
E) none of the above

Question 18

On the income statement, net profit after tax is defined as:

Accepted Answer

A) operating profit minus operating expenses 
B) operating profit minus cost of goods sold 
C) operating profit minus interest 
D) operating profit minus total expenses 
E) none of the above 
A) operating profit minus operating expenses 
B) operating profit minus cost of goods sold 
C) operating profit minus interest 
D) operating profit minus total expenses 
E) none of the above

Question 19

The current liabilities of a business may include:

Accepted Answer

A) notes payable 
B) accounts receivable 
C) prepaid expenses 
D) depreciation reserves 
A) notes payable 
B) accounts receivable 
C) prepaid expenses 
D) depreciation reserves

Question 20

On the income statement, gross profit is defined as:

Accepted Answer

A) operating profits minus operating expenses 
B) gross profit minus operating expenses 
C) sales revenue minus total expenses 
D) sales revenue minus operating expenses 
E) none of the above 
A) operating profits minus operating expenses 
B) gross profit minus operating expenses 
C) sales revenue minus total expenses 
D) sales revenue minus operating expenses 
E) none of the above

Implicit agency costs do not have a direct expense associated with them, but they harm shareholders anyway.

Which of the following are considered to be major financial management functions?

Financial statements that must be included in the annual report include the:

The statement of retained earnings includes all of the following accounts within the statement except:

For corporations, the principal-agent relationship usually refers to the relationship between:

Top finance officers in a corporation may include:

A limited partnership is comprised of:

Which of the following are required to file annual reports with the Securities and Exchange Commission?

Ningbo Steel had year end 2011 and 2012 retained earnings balances of $6,000,000 and $6,600,000 respectively. The firm paid $200,000 of dividends in 2011. Based on this information, Ningbo Steel’s net profit after taxes in 2011 was:

A business should begin with a vision or mission statement that is consistent with the planned overall strategy.

Managerial lines of authority, legal responsibility and the allocation of income and risk are directly related to the form the organization takes.

Which of the following statements is false?

The balance sheet is a statement of a company's financial position over an accounting period.

The Public Company Accounting Oversight Board (PCAOB) is

One advantage of the corporate form of organization is the ease with which ownership may be transferred.

The goal of any firm should be the maximization of sales.

Agency costs may include:

On the income statement, net profit after tax is defined as:

The current liabilities of a business may include:

On the income statement, gross profit is defined as:

The Financial Environment

Money and the Monetary System

Banks and Other Financial Institutions

Federal Reserve System

Policy Makers and the Money Supply

International Finance and Trade

Savings and Investment Process

Interest Rates

Time Value of Money

Bonds and Stocks: Characteristics and Valuation

Securities Markets

Financial Return and Risk Concepts

Financial Analysis and Long-Term Financial Planning

Managing Working Capital

Short-Term Business Financing

Capital Budgeting Analysis

Capital Structure and the Cost of Capital

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Exam 13: Business Organization and Financial Data

Implicit agency costs do not have a direct expense associated with them, but they harm shareholders anyway.

Which of the following are considered to be major financial management functions?

Financial statements that must be included in the annual report include the:

The statement of retained earnings includes all of the following accounts within the statement except:

For corporations, the principal-agent relationship usually refers to the relationship between:

Top finance officers in a corporation may include:

A limited partnership is comprised of:

Which of the following are required to file annual reports with the Securities and Exchange Commission?

Ningbo Steel had year end 2011 and 2012 retained earnings balances of $6,000,000 and $6,600,000 respectively. The firm paid $200,000 of dividends in 2011. Based on this information, Ningbo Steel’s net profit after taxes in 2011 was:

A business should begin with a vision or mission statement that is consistent with the planned overall strategy.

Managerial lines of authority, legal responsibility and the allocation of income and risk are directly related to the form the organization takes.

Which of the following statements is false?

The balance sheet is a statement of a company's financial position over an accounting period.

The Public Company Accounting Oversight Board (PCAOB) is

One advantage of the corporate form of organization is the ease with which ownership may be transferred.

The goal of any firm should be the maximization of sales.

Agency costs may include:

On the income statement, net profit after tax is defined as:

The current liabilities of a business may include:

On the income statement, gross profit is defined as:

The Financial Environment

Money and the Monetary System

Banks and Other Financial Institutions

Federal Reserve System

Policy Makers and the Money Supply

International Finance and Trade

Savings and Investment Process

Interest Rates

Time Value of Money

Bonds and Stocks: Characteristics and Valuation

Securities Markets

Financial Return and Risk Concepts

Financial Analysis and Long-Term Financial Planning

Managing Working Capital

Short-Term Business Financing

Capital Budgeting Analysis

Capital Structure and the Cost of Capital

Filters