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All Chapter 1-27 Fully Covered
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,Corporate Finance, 12e (Ross)
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Chapter 1 Introduction to Corporate Finance
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1) The=treasurer=and=the=controller=of=a=corporation=generally=report=to=the:
A) board=of=directors.
B) chairman=of=the=board.
C) chief=executive=officer.
D) president.
E) chief=financial=officer.
Answer:== E=Difficu
lty:=1=Easy
Section:== 1.1=What=is=Corporate=Finance?= T
opic:= Management=organization=and=roles=
Bloom's: Remember
AACSB:
Reflective=Thinking= Ac
cessibility:= Keyboard=Navigation
2) Which=one=of=the=following=statements=correctly=depicts=the=common=chain=of=command=in=
a= corporation?
A) The=information=systems=manager=reports=to=the=treasurer.
B) The=credit=manager=reports=to=the=treasurer.
C) The=controller=reports=to=the=chief=executive=officer.
D) The=tax=manager=reports=to=the=treasurer.
E) The=capital=expenditures=manager=reports=to=the=controller.
Answer:== B=Difficu
lty:=1=Easy
Section:== 1.1=What=is=Corporate=Finance?= T
opic:= Management=organization=and=roles=
Bloom's: Remember
AACSB:
Reflective=Thinking= Ac
cessibility:= Keyboard=Navigation
3) Which=one=of=the=following=is=a=capital=budgeting=decision?
A) Determining=how=much=debt=should=be=borrowed=from=a=particular=lender
B) Deciding=whether=or=not=a=new=production=facility=should=be=built
C) Deciding=when=to=repay=a=long-term=debt
D) Determining=how=much=inventory=to=keep=on=hand
E) Deciding=how=much=credit=to=grant=to=a=particular=customer
Answer:== B
,Difficulty:=1=Easy
Section:==1.1=What=is=Corporate=Finance?= T
opic:==Capital=budgeting
Bloom's: Understand=AACSB:
Reflective= Thinking= Accessibilit
y:== Keyboard=Navigation
4) Which=one=of=these=is=a=correct=definition?
A) Net=working=capital=equals=current=assets=plus=current=liabilities.
B) Current=liabilities=are=debts=that=must=be=repaid=in=18=months=or=less.
C) Current=assets=are=assets=with=short=lives,=such=as=accounts=receivable.
D) Long-term=debt=is=defined=as=a=residual=claim=on=a=firm's=assets.
E) Tangible=assets=are=fixed=assets=such=as=patents.
Answer:
C
=Difficulty:=1=Easy
Section:=1.1= What= is= Corporate= Finance?= T
opic:=Introduction= to= corporate= finance= Blo
om's:= Remember
AACSB: Reflective
Thinking= Accessibility:==
Keyboard=Navigation
5) The=corporate=controller=is=generally=responsible=for=which=one=of=these=functions?
A) Capital=expenditures
B) Cash=management
C) Tax=reporting
D) Financial=planning
E) Credit=management
Answer:== C=Difficu
lty:=1=Easy
Section:== 1.1=What=is=Corporate=Finance?= T
opic:= Management=organization=and=roles=
Bloom's: Remember
AACSB:
Reflective=Thinking= Ac
cessibility:= Keyboard=Navigation
6) The=corporate=treasurer=oversees=which=one=of=these=areas?
A) Financial=planning
B) Cost=accounting
C) Tax=reporting
D) Information=systems
E) Financial=accounting
Answer:== A
, Difficulty:=1=Easy
Section:== 1.1=What=is=Corporate=Finance?= T
opic:= Management=organization=and=roles=
Bloom's: Remember
AACSB:
Reflective=Thinking= Ac
cessibility:= Keyboard=Navigation
7) A=firm's=capital=structure=refers=to=the=firm's:
A) mixture=of=various=types=of=production=equipment.
B) investment=selections=for=its=excess=cash=reserves.
C) combination=of=cash=and=cash=equivalents.
D) combination=of=accounts=appearing=on=the=left=side=of=its=balance=sheet.
E) proportions=of=financing=from=current=and=long-term=debt=and=equity.
Answer:== E=Difficu
lty:=1=Easy
Section:==1.1=What=is=Corporate=Finance?= T
opic:==Capital=structure
Bloom's: Remember= AACSB:
Reflective= Thinking= Accessibilit
y:== Keyboard=Navigation
8) Short-term=finance=deals=with:
A) the=timing=of=cash=flows.
B) acquiring=and=selling=fixed=assets.
C) financing=long-term=projects.
D) capital=budgeting.
E) issuing=additional=shares=of=common=stock.
Answer:== A=Difficu
lty:=1=Easy
Section:==1.1=What=is=Corporate=Finance
?= Topic:==Cash=management=-
=general= Bloom's: Understand
AACSB:
Reflective=Thinking= Ac
cessibility:= Keyboard=Navigation