WGU C214 Financial Management Final
Exam (Latest Update )
Questions & Answers 100% Correct -
(Grade A)
Coupon Rate - correct answer The interest rate that a company promises to pay on
bonds
Market Rate - correct answer The interest rate on other comparable bonds
Par Value - correct answer The amount payable on maturity of the bond
Market rate - correct answer Same as YTM - Yield to Maturity
Gordon Growth Model - correct answer Assumes stable growth rates and does not
incorporate risk
CAPM Model - correct answer Allows to determine expected return on stocks and
incorporates risk
How do public companies maximize shareholder value? - correct answer By
maximizing Earnings Per Share
How do private companies maximize shareholder value? - correct answer By keeping
control within the company
, Positive credit rating has what effect on capital? - correct answer Lowers cost of
capital
What is cash flow from operating activities? - correct answer It is cash flow generated
for sale of products and services
What is the formula for retained earnings? - correct answer Ending retained
earnings=Beginning retained earnings + Net Income = Dividends
Is depreciation and salvage value on an asset precise or is it an estimate? - correct
answer It is an estimate
What is an example of accounting difference - correct answer Companies using
different accounting methods
What is an example of a timing difference? - correct answer Companies using
different fiscal years
Do stock holders or bond holders have voting rights? - correct answer Stock holders
have voting rights
What factors are considered for the initial outlay of a new investment? - correct
answer Purchase price of new equipment, shipping costs, and investment in working
capital
What is the risk associated with debt financing? - correct answer Too much debt can
lead to bankruptcy
Exam (Latest Update )
Questions & Answers 100% Correct -
(Grade A)
Coupon Rate - correct answer The interest rate that a company promises to pay on
bonds
Market Rate - correct answer The interest rate on other comparable bonds
Par Value - correct answer The amount payable on maturity of the bond
Market rate - correct answer Same as YTM - Yield to Maturity
Gordon Growth Model - correct answer Assumes stable growth rates and does not
incorporate risk
CAPM Model - correct answer Allows to determine expected return on stocks and
incorporates risk
How do public companies maximize shareholder value? - correct answer By
maximizing Earnings Per Share
How do private companies maximize shareholder value? - correct answer By keeping
control within the company
, Positive credit rating has what effect on capital? - correct answer Lowers cost of
capital
What is cash flow from operating activities? - correct answer It is cash flow generated
for sale of products and services
What is the formula for retained earnings? - correct answer Ending retained
earnings=Beginning retained earnings + Net Income = Dividends
Is depreciation and salvage value on an asset precise or is it an estimate? - correct
answer It is an estimate
What is an example of accounting difference - correct answer Companies using
different accounting methods
What is an example of a timing difference? - correct answer Companies using
different fiscal years
Do stock holders or bond holders have voting rights? - correct answer Stock holders
have voting rights
What factors are considered for the initial outlay of a new investment? - correct
answer Purchase price of new equipment, shipping costs, and investment in working
capital
What is the risk associated with debt financing? - correct answer Too much debt can
lead to bankruptcy
