1
BFIN Final Exam Questions with Answers (100% Correct
Answers)
With good accounting knowledge, a financial manager can Answer:
understand financial data of the firm
Accounting can help financial managers: Answer: to interpret and use
financial information in allocating financial resources more efficiently
The field of finance is closely linked to: Answer: accounting and
economics
The goal of financial management is: Answer: to maximize
shareholder's wealth
Which of the following is not a drawback for profit-only focus?
Answer: investors may receive a higher dividend payout
Valuation of assets utilizes: Answer: the present value model and
future expected cash flows
Agency theory describes: Answer: the potential conflicts between the
goals of management and that of shareholders
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,2
Fairness in financial management refers to all of the following with the
exception of: Answer: rewarding CEOs with excessive bonuses
The honesty of the management can be compromised under all the
following conditions with the exception of: Answer: when a manager
complies with regulatory rules
One way to align management's interest with that of shareholder's is:
Answer: granting stock options to management
Which if the following forms exposes all owners to unlimited liability?
Answer: both partnership and proprietorships
Sole Proprietorship is characterized by all of the following except:
Answer: high organizational and operating costs
Select the pair of terms that indicates a correct match Answer:
proprietorship; personal taxation only
Markets that focus on short-term securities are: Answer: money
markets
Markets that focus on securities having life longer than one year are:
Answer: capital market
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, 3
Which of the following statements is not correct about a firm laded
with debt? Answer: the firm is viewed by investors with high growth
potentials
New common stock is sold by firms in the ________ market and
individuals trade securities in ________ market. Answer: primary;
secondary
On January 1, 2018, total assets for Jahara Corp were $136,000; on
December 31, 2018, total assets were $157,000. On January 1, 2018, total
liabilities were $110,000; on December 31, 2018, total liabilities were
$118,000. What is the amount of the change and the direction of the
change in Wininger Technologies' capital for 2019? Answer: increase of
$13,000
In 1990, Dolomites Company purchased a building for $170,000. In
2020, a real estate professional says the building has a fair value of
$1,000,000. In 2020, a similar building down the street recently sold for
$900,000. What value, before consideration of accumulated
depreciation, is reported for the building on the balance sheet at
December 31, 2020? Answer: $170,000
© 2025 All rights reserved
BFIN Final Exam Questions with Answers (100% Correct
Answers)
With good accounting knowledge, a financial manager can Answer:
understand financial data of the firm
Accounting can help financial managers: Answer: to interpret and use
financial information in allocating financial resources more efficiently
The field of finance is closely linked to: Answer: accounting and
economics
The goal of financial management is: Answer: to maximize
shareholder's wealth
Which of the following is not a drawback for profit-only focus?
Answer: investors may receive a higher dividend payout
Valuation of assets utilizes: Answer: the present value model and
future expected cash flows
Agency theory describes: Answer: the potential conflicts between the
goals of management and that of shareholders
© 2025 All rights reserved
,2
Fairness in financial management refers to all of the following with the
exception of: Answer: rewarding CEOs with excessive bonuses
The honesty of the management can be compromised under all the
following conditions with the exception of: Answer: when a manager
complies with regulatory rules
One way to align management's interest with that of shareholder's is:
Answer: granting stock options to management
Which if the following forms exposes all owners to unlimited liability?
Answer: both partnership and proprietorships
Sole Proprietorship is characterized by all of the following except:
Answer: high organizational and operating costs
Select the pair of terms that indicates a correct match Answer:
proprietorship; personal taxation only
Markets that focus on short-term securities are: Answer: money
markets
Markets that focus on securities having life longer than one year are:
Answer: capital market
© 2025 All rights reserved
, 3
Which of the following statements is not correct about a firm laded
with debt? Answer: the firm is viewed by investors with high growth
potentials
New common stock is sold by firms in the ________ market and
individuals trade securities in ________ market. Answer: primary;
secondary
On January 1, 2018, total assets for Jahara Corp were $136,000; on
December 31, 2018, total assets were $157,000. On January 1, 2018, total
liabilities were $110,000; on December 31, 2018, total liabilities were
$118,000. What is the amount of the change and the direction of the
change in Wininger Technologies' capital for 2019? Answer: increase of
$13,000
In 1990, Dolomites Company purchased a building for $170,000. In
2020, a real estate professional says the building has a fair value of
$1,000,000. In 2020, a similar building down the street recently sold for
$900,000. What value, before consideration of accumulated
depreciation, is reported for the building on the balance sheet at
December 31, 2020? Answer: $170,000
© 2025 All rights reserved
