WGU C214 Financial Management Final Test Questions And Answers

WGU C214 Financial Management Final Test Questions And Answers Statement of Cash Flows - CORRECT ANSWER Shows the change in cash balance for a period of time. Focuses only on items where cash is received, or cash is paid. Cash Flow from Operating Activities (CFO) - CORRECT ANSWER Cash flow that a company generates as a result of day-to-day business operations. Deals with Current Assets and Current Liabilities. Cash Flow from Investing Activities (CFI) - CORRECT ANSWER Cash flow that is generated from investments in long term assets. Cash Flow from Financing Activities (CFF) - CORRECT ANSWER Cash flow that is used to fund the company. Cash flow that is generated from financing the business. Includes Debt & Equity. How does an increase in Accounts receivable impact CFO? - CORRECT ANSWER An Increase in Accounts receivable will decrease CFO How does an increase in Accounts payable impact CFO? - CORRECT ANSWER An Increase in Accounts Payable will increase CFO What financial statement is prepared at a point in time - CORRECT ANSWER Balance Sheet What financial statements are prepared for a period of time? - CORRECT ANSWER · Income Statement · Retained Earnings Statement · Statement of Cash Flows Define Efficient Frontier - CORRECT ANSWER Maximizes expected return for a given level of risk Where would a risk averse investor fall on the efficient frontier? - CORRECT ANSWER 100% Bonds Where would a risk-taking investor fall on the efficient frontier? - CORRECT ANSWER 100% Stocks What is a Beta? - CORRECT ANSWER A Measure of Risk - A Beta 1 is the average risk of all stocks. Anytime a beta is below 1, it is less risk. If it is more than 1, it is high risk. Define efficient market hypothesis as it relates to a firm? - CORRECT ANSWER For any company to survive, they need to make profitable decisions. Otherwise, investors will shun their business. The firm needs to invest where the return is more than the cost.