SB101 Final Exam Questions and Correct
Answers
Question 1
What does SCU stand for in MikesBikes? How many SCUs are needed for each bike?
Correct Answer
Standard Capacity Unit
Road- 1.0
Mountain- .50
Youth- .25
Question 2
Brand terminology including trademark
Correct Answer
criteria for choosing brand name
Branding Terminology: Brand, Brand name, Trademark, Personality, Character,
Equity, Awareness, Loyalty
Criteria: -Short and easy to remember
-Legally allowed
-Fit companies image
-Suggest the products benefits
Question 3
Capacity Requirement Calculation
Correct Answer
(Forecasted sales x Required SCU's)/ Production efficacy
Question 4
The fundamental accounting equation
Correct Answer
Assets= Liabilities + Stockholders equity
Page 1 of 26
,Question 5
Total/theoretical capacity versus effective capacity
Correct Answer
Theoretical- Maximum output per unit of time the process can achieve for a short
period of time under ideal operating conditions
Effective- The actual output per unit of time that the organization can reasonably be
expected to sustain in the long run under normal operating conditions
Question 6
Corporate social responsibility
Correct Answer
-The idea that business has obligations to society beyond the pursuit of profits
Philanthropy
-The donation of money, time, goods, or services to charitable, humanitarian, or
educational institutions
Strategic CSR
-Social contributions that are directly aligned with a company's overall business
strategy
Question 7
Media Channels in MBs - Which is best for each bike?
Correct Answer
Road- Magazines
Mountain- mix but mainly magazines
Youth- TV
Question 8
Equity Financing
Correct Answer
provided by shareholders/stockholders
•Dividends- not required to pay, firm must have enough capital to continuously
make dividend payments or SHV will decrease
•Common Stock- last to get paid in liquidation for firm, 1 million issued and
outstanding, maximum amount is 50% of current market value. Increases cash,
dilutes ownership, shares can be repurchased at market value
Page 2 of 26
, Question 9
How do you promote bikes in MBs?
Correct Answer
Advertising and PR
Question 10
Inventory
Correct Answer
Raw Materials Inventory
•Finished Goods inventory
Storing known as warehousing costs
Inventory Management Costs
Question 11
Repurchase of stock in MBs (calculation, limits) Issuing
Correct Answer
-Concentrates ownership interest among remaining shareholders
-Reduces the number of shares outstanding
-Increases EPS
-Will usually boost market value of firm
-Must have cash available to accomplish, so carefully evaluate your firm's cash
position
-Consider ongoing operational cash needs, as well as your firm's long-term capital
investment strategy.
Question 12
How do you know you succeeded in MBs?
Correct Answer
Raising Share Holder Value
Page 3 of 26
Answers
Question 1
What does SCU stand for in MikesBikes? How many SCUs are needed for each bike?
Correct Answer
Standard Capacity Unit
Road- 1.0
Mountain- .50
Youth- .25
Question 2
Brand terminology including trademark
Correct Answer
criteria for choosing brand name
Branding Terminology: Brand, Brand name, Trademark, Personality, Character,
Equity, Awareness, Loyalty
Criteria: -Short and easy to remember
-Legally allowed
-Fit companies image
-Suggest the products benefits
Question 3
Capacity Requirement Calculation
Correct Answer
(Forecasted sales x Required SCU's)/ Production efficacy
Question 4
The fundamental accounting equation
Correct Answer
Assets= Liabilities + Stockholders equity
Page 1 of 26
,Question 5
Total/theoretical capacity versus effective capacity
Correct Answer
Theoretical- Maximum output per unit of time the process can achieve for a short
period of time under ideal operating conditions
Effective- The actual output per unit of time that the organization can reasonably be
expected to sustain in the long run under normal operating conditions
Question 6
Corporate social responsibility
Correct Answer
-The idea that business has obligations to society beyond the pursuit of profits
Philanthropy
-The donation of money, time, goods, or services to charitable, humanitarian, or
educational institutions
Strategic CSR
-Social contributions that are directly aligned with a company's overall business
strategy
Question 7
Media Channels in MBs - Which is best for each bike?
Correct Answer
Road- Magazines
Mountain- mix but mainly magazines
Youth- TV
Question 8
Equity Financing
Correct Answer
provided by shareholders/stockholders
•Dividends- not required to pay, firm must have enough capital to continuously
make dividend payments or SHV will decrease
•Common Stock- last to get paid in liquidation for firm, 1 million issued and
outstanding, maximum amount is 50% of current market value. Increases cash,
dilutes ownership, shares can be repurchased at market value
Page 2 of 26
, Question 9
How do you promote bikes in MBs?
Correct Answer
Advertising and PR
Question 10
Inventory
Correct Answer
Raw Materials Inventory
•Finished Goods inventory
Storing known as warehousing costs
Inventory Management Costs
Question 11
Repurchase of stock in MBs (calculation, limits) Issuing
Correct Answer
-Concentrates ownership interest among remaining shareholders
-Reduces the number of shares outstanding
-Increases EPS
-Will usually boost market value of firm
-Must have cash available to accomplish, so carefully evaluate your firm's cash
position
-Consider ongoing operational cash needs, as well as your firm's long-term capital
investment strategy.
Question 12
How do you know you succeeded in MBs?
Correct Answer
Raising Share Holder Value
Page 3 of 26
