Finance Skills for Managers - D076 practice
test questions correctly defined a+
guaranteed
Accounting - n
ANS✔
The system of recording, reporting, and summarizing past financial information and
transactions.
Qs
Accounts Receivable Turnover (AR Turnover) - n
ANS✔
An activity ratio found by credit sales divided by accounts receivable.
Qs
Activity Ratios - n
ANS✔
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 profitability.
Qs
Additional Funds Needed (AFN) - n
ANS✔
Another name for the discretionary financing needed or external financing needed.
It represents the additional financing needed given a firm's expectations for future
growth.
Qs
Affirmative Covenants - n
ANS✔
,A bond covenant that describes things the company pledges itself to do in order to
protect bondholders.
Qs
Agency Costs - n
ANS✔
Costs that are incurred when management does not act in the best interest of
shareholders.
Qs
Agency Problem - n
ANS✔
When the agent (the management) does not act in the best interest of the principal
(the owners).
Qs
Aggressive Assets - n
ANS✔
Companies or securities with beta greater than 1.
Qs
Annual Percentage Rate - n
ANS✔
The annual interest rate that is charged for borrowing money or that is earned
through investment.
Qs
Annuity - n
ANS✔
A stream of cash flows of an equal amount paid every consecutive period.
,Qs
Annuity Due - n
ANS✔
A series of equal payments made at the beginning of consecutive periods.
Qs
Asset Pricing - n
ANS✔
The process of valuing assets.
Qs
Auction Market - n
ANS✔
A secondary market with a physical location and where prices are determined by
investors' willingness to pay.
Qs
Average Collection Period (ACP) - n
ANS✔
An activity ratio found by the number of days in a year (365) divided by AR
turnover.
Qs
Balance Sheet Forecasting - n
ANS✔
Using sales growth and the profit forecast to construct a pro forma balance sheet to
understand the future implications of the sources and uses of finances.
Qs
Banks and Credit Unions - n
ANS✔
, Receive deposits and extend loans to individuals and businesses.
Qs
Benchmarking - n
ANS✔
The process of completing a financial analysis to compare a firm's financial
performance to that of other similar firms.
Qs
Beta - n
ANS✔
A variable that describes how the price of a security varies with the market.
Qs
Bid-ask Spread - n
ANS✔
The difference between the bid and ask prices that compensate the specialist for
the risk that he or she bears for willingness to provide liquidity.
Qs
Board of Directors - n
ANS✔
A group of people who jointly supervise the activities of an organization.
Qs
Bond Indenture - n
ANS✔
A legal contract that governs the relationship between a firm and its bondholders.
Qs
test questions correctly defined a+
guaranteed
Accounting - n
ANS✔
The system of recording, reporting, and summarizing past financial information and
transactions.
Qs
Accounts Receivable Turnover (AR Turnover) - n
ANS✔
An activity ratio found by credit sales divided by accounts receivable.
Qs
Activity Ratios - n
ANS✔
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 profitability.
Qs
Additional Funds Needed (AFN) - n
ANS✔
Another name for the discretionary financing needed or external financing needed.
It represents the additional financing needed given a firm's expectations for future
growth.
Qs
Affirmative Covenants - n
ANS✔
,A bond covenant that describes things the company pledges itself to do in order to
protect bondholders.
Qs
Agency Costs - n
ANS✔
Costs that are incurred when management does not act in the best interest of
shareholders.
Qs
Agency Problem - n
ANS✔
When the agent (the management) does not act in the best interest of the principal
(the owners).
Qs
Aggressive Assets - n
ANS✔
Companies or securities with beta greater than 1.
Qs
Annual Percentage Rate - n
ANS✔
The annual interest rate that is charged for borrowing money or that is earned
through investment.
Qs
Annuity - n
ANS✔
A stream of cash flows of an equal amount paid every consecutive period.
,Qs
Annuity Due - n
ANS✔
A series of equal payments made at the beginning of consecutive periods.
Qs
Asset Pricing - n
ANS✔
The process of valuing assets.
Qs
Auction Market - n
ANS✔
A secondary market with a physical location and where prices are determined by
investors' willingness to pay.
Qs
Average Collection Period (ACP) - n
ANS✔
An activity ratio found by the number of days in a year (365) divided by AR
turnover.
Qs
Balance Sheet Forecasting - n
ANS✔
Using sales growth and the profit forecast to construct a pro forma balance sheet to
understand the future implications of the sources and uses of finances.
Qs
Banks and Credit Unions - n
ANS✔
, Receive deposits and extend loans to individuals and businesses.
Qs
Benchmarking - n
ANS✔
The process of completing a financial analysis to compare a firm's financial
performance to that of other similar firms.
Qs
Beta - n
ANS✔
A variable that describes how the price of a security varies with the market.
Qs
Bid-ask Spread - n
ANS✔
The difference between the bid and ask prices that compensate the specialist for
the risk that he or she bears for willingness to provide liquidity.
Qs
Board of Directors - n
ANS✔
A group of people who jointly supervise the activities of an organization.
Qs
Bond Indenture - n
ANS✔
A legal contract that governs the relationship between a firm and its bondholders.
Qs
