WGU D076 Finance Skills for Managers
1. The system of recording, reporting, and summarizing past financial
infor- mation and transactions.
ANS Accounting
2. An activity ratio found by credit sales divided by accounts receivable.
ANS Ac- counts Receivable Turnover (AR Turnover)
3. A category of ratios that measure how well a company uses its assets
to generate sales or cash, showing the firm's operational efficiency and
prof- itability.
ANS Activity Ratios
4. Another name for the discretionary financing needed or external
financing needed. It represents the additional financing needed given a
firm's expecta- tions for future growth.
ANS Additional Funds Needed (AFN)
5. A bond covenant that describes things the company pledges itself to do
in order to protect bondholders.
ANS Affirmative Covenants
6. Costs that are incurred when management does not act in the best
,interest of shareholders.
ANS Agency Costs
7. When the agent (the management) does not act in the best interest of the
principle (the owners).
ANS Agency Problem
8. Companies or securities with beta greater than 1.
ANS Aggressive Assets
9. The annual interest rate that is charged for borrowing money or that
is earned through investment.
ANS Annual Percentage Rate
10. A series of equal payments made at the beginning of consecutive
periods.-
ANS Annuity Due
11.A stream of cash flows of an equal amount paid every consecutive
peri- od.
ANS Annuity
12.The process of valuing assets.
ANS Asset Pricing
,13.A secondary market with a physical location and where prices are
deter- mined by investors' willingness to pay.
ANS Auction Market
14.An activity ratio found by the number of days in a year (365) divided by
AR turnover.
ANS Average Collection Period (ACP)
15.Using sales growth and the profit forecast to construct a pro forma bal-
ance sheet to understand the future implications of the sources and uses
of finances.
ANS Balance Sheet Forecasting
16.Receive deposits and extend loans to individuals and businesses.
ANS Banks and Credit Unions
17.The process of completing a financial analysis to compare a firm's
finan- cial performance to that of other similar firms.
ANS Benchmarking
18.A variable that describes how the price of a security varies with
the market.
ANS Beta
, 19.The difference between the bid and ask prices that compensate the
spe- cialist for the risk that he or she bears for willingness to provide
liquidity.
ANS - Bid-ask Spread
20. A group of people who jointly supervise the activities of an organization.
ANS Board of Directors
21.A legal contract that governs the relationship between a firm and
its bondholders.
ANS Bond Indenture
22.A person who loans a corporation money by buying debt securities.
ANS Bond- holders
23. An area of finance that deals with sources of funding, the capital
structure of corporations, the actions that managers take to increase the
value of
the firm to its owners, and the tools and analysis used to allocate
financial resources.
ANS Business Finance
24.The reduction in sales of a company's own products due to
1. The system of recording, reporting, and summarizing past financial
infor- mation and transactions.
ANS Accounting
2. An activity ratio found by credit sales divided by accounts receivable.
ANS Ac- counts Receivable Turnover (AR Turnover)
3. A category of ratios that measure how well a company uses its assets
to generate sales or cash, showing the firm's operational efficiency and
prof- itability.
ANS Activity Ratios
4. Another name for the discretionary financing needed or external
financing needed. It represents the additional financing needed given a
firm's expecta- tions for future growth.
ANS Additional Funds Needed (AFN)
5. A bond covenant that describes things the company pledges itself to do
in order to protect bondholders.
ANS Affirmative Covenants
6. Costs that are incurred when management does not act in the best
,interest of shareholders.
ANS Agency Costs
7. When the agent (the management) does not act in the best interest of the
principle (the owners).
ANS Agency Problem
8. Companies or securities with beta greater than 1.
ANS Aggressive Assets
9. The annual interest rate that is charged for borrowing money or that
is earned through investment.
ANS Annual Percentage Rate
10. A series of equal payments made at the beginning of consecutive
periods.-
ANS Annuity Due
11.A stream of cash flows of an equal amount paid every consecutive
peri- od.
ANS Annuity
12.The process of valuing assets.
ANS Asset Pricing
,13.A secondary market with a physical location and where prices are
deter- mined by investors' willingness to pay.
ANS Auction Market
14.An activity ratio found by the number of days in a year (365) divided by
AR turnover.
ANS Average Collection Period (ACP)
15.Using sales growth and the profit forecast to construct a pro forma bal-
ance sheet to understand the future implications of the sources and uses
of finances.
ANS Balance Sheet Forecasting
16.Receive deposits and extend loans to individuals and businesses.
ANS Banks and Credit Unions
17.The process of completing a financial analysis to compare a firm's
finan- cial performance to that of other similar firms.
ANS Benchmarking
18.A variable that describes how the price of a security varies with
the market.
ANS Beta
, 19.The difference between the bid and ask prices that compensate the
spe- cialist for the risk that he or she bears for willingness to provide
liquidity.
ANS - Bid-ask Spread
20. A group of people who jointly supervise the activities of an organization.
ANS Board of Directors
21.A legal contract that governs the relationship between a firm and
its bondholders.
ANS Bond Indenture
22.A person who loans a corporation money by buying debt securities.
ANS Bond- holders
23. An area of finance that deals with sources of funding, the capital
structure of corporations, the actions that managers take to increase the
value of
the firm to its owners, and the tools and analysis used to allocate
financial resources.
ANS Business Finance
24.The reduction in sales of a company's own products due to
