WGU - C214 Financial Management
Exam 2025 with 100% Verified Solutions
How do firms manage working capital? ✔️✔️Try to collect funds as quickly from customers
as possible and pay bills as slowly as possible.
What ratios are used to determine effective working capital management? ✔️✔️- Current Ratio
- Cash Ratio
- Receivables Turnover Ratio
Name two basic types of financial instruments? ✔️✔️Stocks and Bonds
What are Primary Markets? ✔️✔️Where companies sell securities directly to investors
What are Secondary Markets? ✔️✔️Where securities are bought and sold from third parties
like the New York Stock Exchange
Name two types of secondary markets? ✔️✔️New York Stock Exchange (NYSE) and the
NASDAQ
Define or describe an income statement? ✔️✔️Reports the company's revenues and expenses
during a particular period of time. Also reports net income or net loss. Always prepared first.
, Define Free Cash Flow ✔️✔️Represents the cash a company generates after accounting for
cash outflows to support operations and maintain its capital assets
Give two examples of accounting estimates used in financial accounting? ✔️✔️Depreciation
and Salvage Value
Give an example of an accounting difference? ✔️✔️Companies using different accounting
methods / such as Inventory.
What securities issued by the federal government is taxable? ✔️✔️Treasury Bonds
What is a secured loan? ✔️✔️Means that some type of asset is being used as collateral to back
the loan.
What is an unsecured loan? ✔️✔️loan is one that is not backed by a specific asset. An example
of an unsecured loan is the line of credit offered by credit card companies.
At what price will a bond sell if the required rate of return is equal to the coupon rate?
✔️✔️The price will be equal to its par value. At a par price, the yield will equal the coupon
rate.
Exam 2025 with 100% Verified Solutions
How do firms manage working capital? ✔️✔️Try to collect funds as quickly from customers
as possible and pay bills as slowly as possible.
What ratios are used to determine effective working capital management? ✔️✔️- Current Ratio
- Cash Ratio
- Receivables Turnover Ratio
Name two basic types of financial instruments? ✔️✔️Stocks and Bonds
What are Primary Markets? ✔️✔️Where companies sell securities directly to investors
What are Secondary Markets? ✔️✔️Where securities are bought and sold from third parties
like the New York Stock Exchange
Name two types of secondary markets? ✔️✔️New York Stock Exchange (NYSE) and the
NASDAQ
Define or describe an income statement? ✔️✔️Reports the company's revenues and expenses
during a particular period of time. Also reports net income or net loss. Always prepared first.
, Define Free Cash Flow ✔️✔️Represents the cash a company generates after accounting for
cash outflows to support operations and maintain its capital assets
Give two examples of accounting estimates used in financial accounting? ✔️✔️Depreciation
and Salvage Value
Give an example of an accounting difference? ✔️✔️Companies using different accounting
methods / such as Inventory.
What securities issued by the federal government is taxable? ✔️✔️Treasury Bonds
What is a secured loan? ✔️✔️Means that some type of asset is being used as collateral to back
the loan.
What is an unsecured loan? ✔️✔️loan is one that is not backed by a specific asset. An example
of an unsecured loan is the line of credit offered by credit card companies.
At what price will a bond sell if the required rate of return is equal to the coupon rate?
✔️✔️The price will be equal to its par value. At a par price, the yield will equal the coupon
rate.
