FIN 300 Exam 1 || 100% Detailed Answers.
Which one of the following terms is defined as the management of a firm's long-term
investments?
a. Working capital management.
b. Financial allocation.
c. Agency cost analysis.
d. Capital budgeting.
e. Capital structure. correct answers Capital Budgeting
A business owned by a solitary individual who has unlimited liability for its debt is called a:
a. Corporation.
b. Sole proprietorship.
c. General partnership.
d. Limited partnership.
e. Limited liability company. correct answers Sole Proprietorship
A business formed by two or more individuals who each have unlimited liability for all of the
firm's business debts is called a:
a. Corporation.
b. Sole proprietorship.
c. General partnership.
d. Limited partnership.
e. Limited liability company. correct answers General Partnership
,Which one of the following terms is defined as a conflict of interest between the corporate
shareholders and the corporate managers?
a. Articles of incorporation.
b. Corporate breakdown.
c. Agency problem.
d. Bylaws.
e. Legal liability. correct answers Agency Problem
A stakeholder is:
a. A person who owns shares of stock.
b. Any person who has voting rights based on stock ownership of a corporation.
c. A person who initially founded a firm and currently has management control over that firm.
d. A creditor to whom a firm currently owes money.
e. Any person or entity other than a stockholder or creditor who potentially has a claim on the
cash flows of a firm. correct answers Any person or entity other than a stockholder or creditor
who potentially has a claim on cash flows of a firm.
Which one of the following functions should be the responsibility of the controller rather than
the treasurer?
a. Daily cash deposit.
b. Income tax returns.
c. Equipment purchase analysis.
d. Customer credit approval.
e. Payment to a vendor. correct answers Income tax returns
, Which one of the following is a capital budgeting decision?
a. Determining how many shares of stock to issue.
b. Deciding whether or not to purchase a new machine for the production line.
c. Deciding how to refinance a debt issue that is maturing.
d. Determining how much inventory to keep on hand.
e. Determining how much money should be kept in the checking account. correct answers
Deciding whether or not to purchase a new machine for the product line.
The decision to issue additional shares of stock is an example of which one of the following?
a. Working capital management.
b. Net working capital decision.
c. Capital budgeting.
d. Controller's duties.
e. Capital structure decision. correct answers Capital structure decision
Which of the following accounts are included in working capital management?
I. Accounts Payable
II. Accounts Receivable
III.Fixed Assets
IV. Inventory
a. I and II only.
b. I and III only.
c. II and IV only.
d. I, II, and IV only.
Which one of the following terms is defined as the management of a firm's long-term
investments?
a. Working capital management.
b. Financial allocation.
c. Agency cost analysis.
d. Capital budgeting.
e. Capital structure. correct answers Capital Budgeting
A business owned by a solitary individual who has unlimited liability for its debt is called a:
a. Corporation.
b. Sole proprietorship.
c. General partnership.
d. Limited partnership.
e. Limited liability company. correct answers Sole Proprietorship
A business formed by two or more individuals who each have unlimited liability for all of the
firm's business debts is called a:
a. Corporation.
b. Sole proprietorship.
c. General partnership.
d. Limited partnership.
e. Limited liability company. correct answers General Partnership
,Which one of the following terms is defined as a conflict of interest between the corporate
shareholders and the corporate managers?
a. Articles of incorporation.
b. Corporate breakdown.
c. Agency problem.
d. Bylaws.
e. Legal liability. correct answers Agency Problem
A stakeholder is:
a. A person who owns shares of stock.
b. Any person who has voting rights based on stock ownership of a corporation.
c. A person who initially founded a firm and currently has management control over that firm.
d. A creditor to whom a firm currently owes money.
e. Any person or entity other than a stockholder or creditor who potentially has a claim on the
cash flows of a firm. correct answers Any person or entity other than a stockholder or creditor
who potentially has a claim on cash flows of a firm.
Which one of the following functions should be the responsibility of the controller rather than
the treasurer?
a. Daily cash deposit.
b. Income tax returns.
c. Equipment purchase analysis.
d. Customer credit approval.
e. Payment to a vendor. correct answers Income tax returns
, Which one of the following is a capital budgeting decision?
a. Determining how many shares of stock to issue.
b. Deciding whether or not to purchase a new machine for the production line.
c. Deciding how to refinance a debt issue that is maturing.
d. Determining how much inventory to keep on hand.
e. Determining how much money should be kept in the checking account. correct answers
Deciding whether or not to purchase a new machine for the product line.
The decision to issue additional shares of stock is an example of which one of the following?
a. Working capital management.
b. Net working capital decision.
c. Capital budgeting.
d. Controller's duties.
e. Capital structure decision. correct answers Capital structure decision
Which of the following accounts are included in working capital management?
I. Accounts Payable
II. Accounts Receivable
III.Fixed Assets
IV. Inventory
a. I and II only.
b. I and III only.
c. II and IV only.
d. I, II, and IV only.
