WGU C214 Object Assessment Financial Management 2023/ 2024 Exam| Questions and Verified Answers| Grade A+

WGU C214 Object Assessment Financial Management 2023/ 2024 Exam| Questions and Verified Answers| Grade A+ Q: Why would we reject a project based on IRR? Answer: The discount rate is higher than the IRR Q: What are two key elements of differential cash flow? Answer: Depreciation expense and net income Q: Why is the NPV preferred over the IRR? Answer: It measures the dollar value and is more reliable. Q: When a company uses more leverage as evidenced by a higher degree of either financial or operating leverage, what effect does it have on changes in profitability? Answer: Higher leverage leads to higher profitability for a given sale level. Q: What does the degree of financial leverage indicate? Answer: The reliance on debt Q: If a company has a high degree of financial leverage, what does that tell us about the firms risk profile? Answer: Financial leverage also means that more financing is done through debt, not equity. Higher profits to shareholders. Q: What is the cash cycle? Answer: The amount of time to regenerate cash. Q: Why is float important to understand? Answer: To time cash expenditures Q: What should a company do to manage its working capital? Answer: Collect quickly and pay slowly Q: Name what characterizes increased collection float? Answer: Increased float indicates slower processing time. Q: In regards to Accounts Payable Balances, what is a good policy? Answer: Paying off A/P on the last day due is a good policy. Q: What would be a good source of information to determine replacement cost? Answer: Building Appraisal Q: Dodd-Frank Act regulates which segment of the U.S economy? Answer: Banking industry Q: What is the regulatory body that overseas the systematic risk in banking? Answer: Financial stability oversight council Q: The SEC securities and Exchange Commission requires companies to do the following three things: Answer: Register all public offerings, regulate stock sales and ensure transparency through uniform reporting.