Question 1

Evidence suggests that:

Accepted Answer

A) Businesses tend to follow the 'trade-off' theory. 
B) Most businesses are financially geared. 
C) Few businesses appear to be highly geared. 
D) All of the above. 
A) Businesses tend to follow the 'trade-off' theory. 
B) Most businesses are financially geared. 
C) Few businesses appear to be highly geared. 
D) All of the above.

Question 2

The minimum share value a company must have to be listed on the Australian Securities Exchange is:

Accepted Answer

A) $1 million. 
B) $5 million. 
C) $10 million. 
D) $50 million. 
A) $1 million. 
B) $5 million. 
C) $10 million. 
D) $50 million.

Question 3

Which of the following would decrease a firm's internal sources of finance?

Accepted Answer

A) delay payments to accounts payable. 
B) increase inventory levels. 
C) retain more profits. 
D) cut the dividend rate. 
A) delay payments to accounts payable. 
B) increase inventory levels. 
C) retain more profits. 
D) cut the dividend rate.

Question 4

Gearing refers to the use of:

Accepted Answer

A) financing through preference shares. 
B) debt financing. 
C) equity financing. 
D) none of the above. 
A) financing through preference shares. 
B) debt financing. 
C) equity financing. 
D) none of the above.

Question 5

Which of the following is a difference between ordinary and preference shares?

Accepted Answer

A) Preference shareholders receive priority of payment above ordinary shareholders on the winding up of the company. 
B) Preference shares offer investors a lower level of risk than ordinary shares. 
C) Preference dividends are paid before ordinary dividends. 
D) All are differences. 
A) Preference shareholders receive priority of payment above ordinary shareholders on the winding up of the company. 
B) Preference shares offer investors a lower level of risk than ordinary shares. 
C) Preference dividends are paid before ordinary dividends. 
D) All are differences.

Question 6

The underlying rationale of Australian Securities Exchange is:

Accepted Answer

A) to enable stockbrokers to charge commission on buying and selling shares. 
B) to enable investors to sell their shares easily. 
C) to enable companies to raise new capital. 
D) Both B and C. 
A) to enable stockbrokers to charge commission on buying and selling shares. 
B) to enable investors to sell their shares easily. 
C) to enable companies to raise new capital. 
D) Both B and C.

Question 7

Preference shares which allow the investor to receive dividends in arrears, when the company declares and pays a dividend, are called:

Accepted Answer

A) cumulative preference shares. 
B) redeemable preference shares. 
C) participating preference shares. 
D) none of the above. 
A) cumulative preference shares. 
B) redeemable preference shares. 
C) participating preference shares. 
D) none of the above.

Question 8

Loan capital which can be converted into equity capital at the option of the holder is known as:

Accepted Answer

A) preference shares. 
B) convertible preference shares. 
C) convertible loan stock. 
D) warrants. 
A) preference shares. 
B) convertible preference shares. 
C) convertible loan stock. 
D) warrants.

Evidence suggests that:

The minimum share value a company must have to be listed on the Australian Securities Exchange is:

Which of the following would decrease a firm's internal sources of finance?

Gearing refers to the use of:

Which of the following is a difference between ordinary and preference shares?

The underlying rationale of Australian Securities Exchange is:

Preference shares which allow the investor to receive dividends in arrears, when the company declares and pays a dividend, are called:

Loan capital which can be converted into equity capital at the option of the holder is known as:

Introduction to Accounting

Measuring and Reporting Financial Position

Measuring and Reporting Financial Performance

Introduction to Limited Companies

Regulatory Framework for Companies

Measuring and Reporting Cash Flows

Corporate Social Responsibility and Sustainability Accounting

Analysis and Interpretation of Financial Statements

Cost-Volume-Profit Analysis and Relevant Costing

Full Costing

Budgeting

Capital Investment Decisions

The Management of Working Capital

Filters

Exam 14: Financing the Business

Evidence suggests that:

The minimum share value a company must have to be listed on the Australian Securities Exchange is:

Which of the following would decrease a firm's internal sources of finance?

Gearing refers to the use of:

Which of the following is a difference between ordinary and preference shares?

The underlying rationale of Australian Securities Exchange is:

Preference shares which allow the investor to receive dividends in arrears, when the company declares and pays a dividend, are called:

Loan capital which can be converted into equity capital at the option of the holder is known as:

Introduction to Accounting

Measuring and Reporting Financial Position

Measuring and Reporting Financial Performance

Introduction to Limited Companies

Regulatory Framework for Companies

Measuring and Reporting Cash Flows

Corporate Social Responsibility and Sustainability Accounting

Analysis and Interpretation of Financial Statements

Cost-Volume-Profit Analysis and Relevant Costing

Full Costing

Budgeting

Capital Investment Decisions

The Management of Working Capital

Filters