Test Bank for Corporate Finance 13th Edition by Stephen Ross and Randolph Westerfield – Complete Chapters 1–21

Test Bank for Corporate Finance
13th Edition By Stephen Ross, Randolph Westerfield,
Chapters 1 - 21, Complete




Version 1
wl 1

,Chapter 1 wl




Student name:_ wl wl




MULTIPLE CHOICE - wl wl




Choose the onealternative that best completes the statement oranswers the question.
wl wl wl wl wl wl wl wl wl wl w
l wl wl




1) Generally, among those who report directlyto the wl wl wl wl wl wl wl




are the treasurer and thecontroller of a corporation.
wl wl wl wl w
l wl wl wl




A) board of directors wl wl




B) chairperson ofthe board wl wl wl




C) chiefexecutive officer wl wl




D) president
E) chief financialofficer wl wl




2) Atypical chain ofcommand in a corporation is described by which one ofthe followingstatem
wl wl wl wl wl wl wl wl wl wl wl wl wl wl wl w
l




ents?

A) The information systems manager reports to the treasurer.
wl wl wl wl wl wl wl




B) The credit manager reports to the treasurer.
wl wl wl wl wl wl




C) The controller reports to the chiefexecutive officer.
wl wl wl wl wl wl wl




D) Thetax manager reports to the treasurer.
wl wl wl wl wl wl




E) The capitalexpenditures manager reportsto the controller.
wl wl wl wl w
l wl wl




3) Answering which one ofthe following questions involves making a capital budgetingdeci
wl wl wl wl wl wl wl wl wl wl wl w
l




sion?




Version 1
wl 2

, A) How much debt should the firm borrow from a particular lender?
wl wl wl wl wl wl wl wl wl wl




B) Should the firm build a new production facility? wl wl wl wl wl wl wl




C) Should the firm issue new equityto pay for its growth goals?
wl wl wl wl wl wl wl wl wl wl wl




D) How much inventoryshould the firm keep on hand?
wl wl wl wl wl wl wl wl




E) Howmuchcredit should the firmextend to a particular customer?
wl wl wl wl wl wl wl wl wl wl




4) Whichone ofthe following statements is accurate?
wl wl wl wl wl wl wl




A) Net working capitalequals current assets plus current liabilities.
wl wl w
l wl wl wl wl wl




B) Current liabilities are debts that must be repaid in 18 months or less.
wl wl wl wl wl wl wl wl wl wl wl wl




C) Current assets areassets with short lives, such as accounts receivable.
wl wl wl wl wl wl wl wl wl wl




D) Long-termdebt is defined as a residual claim on a firm’s assets. wl w l wl wl wl wl wl wl wl wl wl




E) Tangible assets are fixed assets such as patents. wl wl wl wl wl wl wl




5) Among the typical responsibilities ofthe corporate controller is:
wl wl wl wl wl wl wl wl




A) capitalexpenditures management. w
l wl




B) cash management. wl




C) taxreporting.
wl




D) financialplanning. wl




E) credit management. wl




6) wl is typically the responsibilityofthe corporatetreasurer.
wl wl wl wl wl wl wl




A) Financialplanning wl




B) Cost accounting wl




C) Tax reporting wl




D) Informationsystems wl




E) Financialaccounting w
l




7) A firm’s wl define(s) its capitalstructure. wl wl wl




Version 1 wl 3

, A) mixture ofvarious types of production equipment wl wl wl wl wl wl




B) investment selections for its excess cash reserves wl wl wl wl wl wl




C) combination of cash and cash equivalents wl wl wl wl wl




D) combination ofaccounts appearing on the left side of its balance sheet wl wl wl wl wl wl wl wl wl wl wl




E) proportions of financing fromdebt and equity wl wl wl wl wl wl




8) The focus ofshort-term finance is on:
wl wl wl wl wl wl




A) the timing ofcash flows.
wl wl wl wl




B) acquiring and selling fixed assets. wl wl wl wl




C) financing long-termprojects. wl w
l




D) capital budgeting. wl




E) issuing additionalshares ofcommon stock.
wl wl wl wl wl




9) Net working capital includes:
wl wl wl




A) copyrights.
B) manufacturing equipment. wl




C) common stock. wl




D) long-term debt. wl




E) inventory.



10) wl is defined as planning and managing a firm’s long-termassets.
wl wl wl wl wl wl wl wl wl




A) Working capitalmanagement wl wl




B) Cash management
wl




C) Cost accounting management
wl wl




D) Capitalbudgeting w
l




E) Capitalstructure management w
l wl




11) Anamount the firms owes, which it must repaywithin twelve months, is called a(n):
wl wl wl wl wl wl wl wl w
l wl wl wl wl wl




Version 1 wl 4