MHA 706 MIDTERM EXAM AND STUDY GUIDE- LORD
NEWEST 2026 TEST BANK| LSUS MHA 706 FINANCIAL
MANAGEMENT MIDTERM REVIEW WITH
COMPLETE REAL EXAM QUESTIONS AND CORRECT
VERIFIED ANSWERS/ GRADED A+ (MOST RECENT!!)
The primary goal of financial management is most associated with
increasing the:
a) traffic flow within the firm's stores
b) fixed costs while lowering the variable costs
c) firm's liquidity
d) market value of the firm - Correct Answer - market value of the firm
Which one of the following best describes the primary intent of the
Sarbanes-Oxley Act of 2002?
a) Decrease the number of corporations that can be publicly traded
b) Increase the protections against corporate fraud
c) Limit secondary issues of corporate securities
d) Increase the dividends paid to shareholders - Correct Answer -
Increase the protections against corporate fraud
Uptown Markets is financed with 45 percent debt and 55 percent equity.
This mixture of debt and equity is referred to as the firm's:
a) capital structure.
b) capital budget.
c) asset allocation.
pg. 1
,d) working capital. - Correct Answer - capital structure.
Raleigh BBQ has $48,000 in current assets and $39,000 in current
liabilities. Decisions related to these accounts are referred to as:
a) capital structure decisions.
b) capital budgeting decisions.
c) working capital management.
d) operating management. - Correct Answer - working capital
management
The potential conflict of interest between a firm's owners and its
managers is referred to as which type of conflict?
a) Organizational
b) Structural
c) Formative
d) Agency - Correct Answer - Agency
The shareholders of Qiang's Markets would benefit if the firm were to be
acquired by Better Foods. However, Weil's board of directors rejects the
acquisition offer. This is an example of:
a) a corporate takeover.
b) a capital structure issue.
c) a working capital decision.
d) an agency conflict. - Correct Answer - an agency conflict.
pg. 2
,If you accept a job as a domestic security analyst for a brokerage firm,
you are most likely working in which one of the following financial
areas?
a) International finance
b) Private placements
c) Corporate finance
d) Investments - Correct Answer - Investments
Which one of the following occupations best fits into the corporate area
of finance?
a) Mortgage broker
b) Treasury bill analyst
c) Chief financial officer
d) Insurance risk manager - Correct Answer - Chief financial officer
Which one of the following functions is generally a responsibility
assigned to the corporate treasurer?
a) Cost accounting
b) Data processing
c) Financial accounting
d) Capital expenditures - Correct Answer - Capital expenditures
Which one of the following functions should be assigned to the
corporate treasurer rather than to the controller?
a) Data processing
b) Cost accounting
pg. 3
, c) Tax management
d) Cash management - Correct Answer - Cash management
Which one of the following correctly defines a common chain of
command within a corporation?
a) The controller reports directly to the corporate treasurer.
b) The treasurer reports directly to the board of directors.
c) The chief financial officer reports directly to the board of directors.
d) The controller reports directly to the chief financial officer. - Correct
Answer - The controller reports directly to the chief financial officer.
Capital budgeting includes the evaluation of which of the following?
a) Size of future cash flows only
b) Timing and risk of future cash flows only
c) Risk and size of future cash flows only
d) Size, timing, and risk of future cash flows - Correct Answer - Size,
timing, and risk of future cash flows
Which one of the following forms of business organization offers
liability protection to some of its owners but not to all of its owners?
a) Sole proprietorship
b) General partnership
c) Limited partnership
d) Limited liability company - Correct Answer - Limited partnership
pg. 4
NEWEST 2026 TEST BANK| LSUS MHA 706 FINANCIAL
MANAGEMENT MIDTERM REVIEW WITH
COMPLETE REAL EXAM QUESTIONS AND CORRECT
VERIFIED ANSWERS/ GRADED A+ (MOST RECENT!!)
The primary goal of financial management is most associated with
increasing the:
a) traffic flow within the firm's stores
b) fixed costs while lowering the variable costs
c) firm's liquidity
d) market value of the firm - Correct Answer - market value of the firm
Which one of the following best describes the primary intent of the
Sarbanes-Oxley Act of 2002?
a) Decrease the number of corporations that can be publicly traded
b) Increase the protections against corporate fraud
c) Limit secondary issues of corporate securities
d) Increase the dividends paid to shareholders - Correct Answer -
Increase the protections against corporate fraud
Uptown Markets is financed with 45 percent debt and 55 percent equity.
This mixture of debt and equity is referred to as the firm's:
a) capital structure.
b) capital budget.
c) asset allocation.
pg. 1
,d) working capital. - Correct Answer - capital structure.
Raleigh BBQ has $48,000 in current assets and $39,000 in current
liabilities. Decisions related to these accounts are referred to as:
a) capital structure decisions.
b) capital budgeting decisions.
c) working capital management.
d) operating management. - Correct Answer - working capital
management
The potential conflict of interest between a firm's owners and its
managers is referred to as which type of conflict?
a) Organizational
b) Structural
c) Formative
d) Agency - Correct Answer - Agency
The shareholders of Qiang's Markets would benefit if the firm were to be
acquired by Better Foods. However, Weil's board of directors rejects the
acquisition offer. This is an example of:
a) a corporate takeover.
b) a capital structure issue.
c) a working capital decision.
d) an agency conflict. - Correct Answer - an agency conflict.
pg. 2
,If you accept a job as a domestic security analyst for a brokerage firm,
you are most likely working in which one of the following financial
areas?
a) International finance
b) Private placements
c) Corporate finance
d) Investments - Correct Answer - Investments
Which one of the following occupations best fits into the corporate area
of finance?
a) Mortgage broker
b) Treasury bill analyst
c) Chief financial officer
d) Insurance risk manager - Correct Answer - Chief financial officer
Which one of the following functions is generally a responsibility
assigned to the corporate treasurer?
a) Cost accounting
b) Data processing
c) Financial accounting
d) Capital expenditures - Correct Answer - Capital expenditures
Which one of the following functions should be assigned to the
corporate treasurer rather than to the controller?
a) Data processing
b) Cost accounting
pg. 3
, c) Tax management
d) Cash management - Correct Answer - Cash management
Which one of the following correctly defines a common chain of
command within a corporation?
a) The controller reports directly to the corporate treasurer.
b) The treasurer reports directly to the board of directors.
c) The chief financial officer reports directly to the board of directors.
d) The controller reports directly to the chief financial officer. - Correct
Answer - The controller reports directly to the chief financial officer.
Capital budgeting includes the evaluation of which of the following?
a) Size of future cash flows only
b) Timing and risk of future cash flows only
c) Risk and size of future cash flows only
d) Size, timing, and risk of future cash flows - Correct Answer - Size,
timing, and risk of future cash flows
Which one of the following forms of business organization offers
liability protection to some of its owners but not to all of its owners?
a) Sole proprietorship
b) General partnership
c) Limited partnership
d) Limited liability company - Correct Answer - Limited partnership
pg. 4
