Board of Governors Examination Online Tutorial Finance Sample Test Questions And Answers

Board of Governors Examination Online Tutorial Finance Sample Test Questions And Answers Net income as a percentage of gross revenues and return on equity are the two most important indicators of: a. Profitability b. Credit worthiness c. Market Strength d. Cash Position - ANS A. When reviewing assets, which element is the most important indication of an organization's liquidity? a. Buildings and equipment b. Long-term investments c. Cash and short-term investments d. Land and other assets - ANS C. Financial statements are important in order to: a. Identify, measure, record and communicate, in dollar terms, the economic events and status of an organization b. Serve as a control mechanism for budgeting c. Provide detailed financial information for control at the department level d. Provide staffing guidelines to human resources managers - ANS A. In most cases, the most favorable opinion that an organization can receive is a(n): a. Qualified Opinion b. Adverse Opinion c. Disclaimer of Opinion d. Unqualified Opinion - ANS D The purpose of the statement of operations, or income statement, is to: a. Present the financial position of the organization at a specific point in time b. Present the reasons net assets changed from one period to another c. Present cash receipts and where they came from and cash disbursements and where they went during an accounting period d. Present the operating results of the organization over a period of time - ANS D. Ratios that measure an organization's long-term liquidity are called: a. Liquidity ratios b. Profitability ratios