Finance Skills for Managers - D076 Questions and Answers 100% Pass

Accounting - The system of recording, reporting, and summarizing past financial information and transactions. Accounts Receivable Turnover (AR Turnover) - An activity ratio found by credit sales divided by accounts receivable. Activity Ratios - 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. Additional Funds Needed (AFN) - 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. Affirmative Covenants - A bond covenant that describes things the company pledges itself to do in order to protect bondholders. Agency Costs - Costs that are incurred when management does not act in the best interest of shareholders.