WGU D076 ACTUAL STUDYS QUESTIONS AND
ANSWERS SURE A+
✔✔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.Go To
✔✔Agency Costs - ✔✔Costs that are incurred when management does not act in the
best interest of shareholders.
✔✔Agency Problem - ✔✔When the agent (the management) does not act in the best
interest of the principal (the owners).Go To
✔✔Aggressive Assets - ✔✔Companies or securities with beta greater than 1.
✔✔Annual Percentage Rate - ✔✔The annual interest rate that is charged for borrowing
money or that is earned through investment.
,✔✔Annuity - ✔✔A stream of cash flows of an equal amount paid every consecutive
period.Go To
✔✔Annuity Due - ✔✔A series of equal payments made at the beginning of consecutive
periods.Go To
✔✔Asset Pricing - ✔✔The process of valuing assets.
✔✔Auction Market - ✔✔A secondary market with a physical location and where prices
are determined by investors' willingness to pay.Go To
✔✔Average Collection Period (ACP) - ✔✔An activity ratio found by the number of days
in a year (365) divided by AR turnover.Go To
✔✔Balance Sheet Forecasting - ✔✔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.
✔✔Banks and Credit Unions - ✔✔Receive deposits and extend loans to individuals and
businesses.
✔✔Benchmarking - ✔✔The process of completing a financial analysis to compare a
firm's financial performance to that of other similar firms.
✔✔Beta - ✔✔A variable that describes how the price of a security varies with the
market.
✔✔Bid-ask Spread - ✔✔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.
✔✔Board of Directors - ✔✔A group of people who jointly supervise the activities of an
organization.
✔✔Bond Indenture - ✔✔A legal contract that governs the relationship between a firm
and its bondholders.Go To
✔✔Bondholders - ✔✔A person who loans a corporation money by buying debt
securities.Go To
✔✔Business Finance - ✔✔An area of finance that deals with sources of funding, the
capital structure of corporations, the actions that managers take to increase the value of
the firm to its owners, and the tools and analysis used to allocate financial resources.Go
To
, ✔✔Cannibalization - ✔✔The reduction in sales of a company's own products due to
introduction of another similar product.Go To
✔✔Capital - ✔✔A financial asset that can be used by a firm or individual. Examples of
capital may be machinery or cash held by a firm.Go To
✔✔Capital Asset Pricing Model (CAPM) - ✔✔A model used to determine the risk-return
relationship for an asset.Go To
✔✔Capital Budgeting - ✔✔The process of evaluation and planning for purchases of
long-term assets.Go To
✔✔Capital Budgeting Criteria - ✔✔Metrics and calculations used to determine whether
a project or asset will add value and be a worthwhile investment.Go To
✔✔Capital Investment - ✔✔The sum of money invested in a business to purchase long-
term assets to further its objective of maximizing owner wealth.Go To
✔✔Capital Markets - ✔✔A type of financial market used for long-term assets that are
held for greater than one year.Go To
✔✔Capital Structure - ✔✔The mixture of debt and equity used to finance a firm.Go To
✔✔Capital-constrained Environment - ✔✔When a limited amount of funds are
available.Go To
✔✔Cash Budgets - ✔✔A plan for controlling cash inflows and outflows business to
balance income with expenditures.Go To
✔✔Cash Management - ✔✔Managing the day-to-day finance operations of a firm.Go To
✔✔Central Banks - ✔✔Ensure that a nation's economy remains healthy by controlling
the amount of money circulating in the economy.Go To
✔✔Common Stock - ✔✔A type of stock that represents equity in a firm and confers the
right to vote at shareholder meetings.Go To
✔✔Compounding - ✔✔Finding a future value given a present value.Go To
✔✔Compounding Interest - ✔✔The interest on the principal plus the interest on earned
interest.Go To
ANSWERS SURE A+
✔✔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.Go To
✔✔Agency Costs - ✔✔Costs that are incurred when management does not act in the
best interest of shareholders.
✔✔Agency Problem - ✔✔When the agent (the management) does not act in the best
interest of the principal (the owners).Go To
✔✔Aggressive Assets - ✔✔Companies or securities with beta greater than 1.
✔✔Annual Percentage Rate - ✔✔The annual interest rate that is charged for borrowing
money or that is earned through investment.
,✔✔Annuity - ✔✔A stream of cash flows of an equal amount paid every consecutive
period.Go To
✔✔Annuity Due - ✔✔A series of equal payments made at the beginning of consecutive
periods.Go To
✔✔Asset Pricing - ✔✔The process of valuing assets.
✔✔Auction Market - ✔✔A secondary market with a physical location and where prices
are determined by investors' willingness to pay.Go To
✔✔Average Collection Period (ACP) - ✔✔An activity ratio found by the number of days
in a year (365) divided by AR turnover.Go To
✔✔Balance Sheet Forecasting - ✔✔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.
✔✔Banks and Credit Unions - ✔✔Receive deposits and extend loans to individuals and
businesses.
✔✔Benchmarking - ✔✔The process of completing a financial analysis to compare a
firm's financial performance to that of other similar firms.
✔✔Beta - ✔✔A variable that describes how the price of a security varies with the
market.
✔✔Bid-ask Spread - ✔✔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.
✔✔Board of Directors - ✔✔A group of people who jointly supervise the activities of an
organization.
✔✔Bond Indenture - ✔✔A legal contract that governs the relationship between a firm
and its bondholders.Go To
✔✔Bondholders - ✔✔A person who loans a corporation money by buying debt
securities.Go To
✔✔Business Finance - ✔✔An area of finance that deals with sources of funding, the
capital structure of corporations, the actions that managers take to increase the value of
the firm to its owners, and the tools and analysis used to allocate financial resources.Go
To
, ✔✔Cannibalization - ✔✔The reduction in sales of a company's own products due to
introduction of another similar product.Go To
✔✔Capital - ✔✔A financial asset that can be used by a firm or individual. Examples of
capital may be machinery or cash held by a firm.Go To
✔✔Capital Asset Pricing Model (CAPM) - ✔✔A model used to determine the risk-return
relationship for an asset.Go To
✔✔Capital Budgeting - ✔✔The process of evaluation and planning for purchases of
long-term assets.Go To
✔✔Capital Budgeting Criteria - ✔✔Metrics and calculations used to determine whether
a project or asset will add value and be a worthwhile investment.Go To
✔✔Capital Investment - ✔✔The sum of money invested in a business to purchase long-
term assets to further its objective of maximizing owner wealth.Go To
✔✔Capital Markets - ✔✔A type of financial market used for long-term assets that are
held for greater than one year.Go To
✔✔Capital Structure - ✔✔The mixture of debt and equity used to finance a firm.Go To
✔✔Capital-constrained Environment - ✔✔When a limited amount of funds are
available.Go To
✔✔Cash Budgets - ✔✔A plan for controlling cash inflows and outflows business to
balance income with expenditures.Go To
✔✔Cash Management - ✔✔Managing the day-to-day finance operations of a firm.Go To
✔✔Central Banks - ✔✔Ensure that a nation's economy remains healthy by controlling
the amount of money circulating in the economy.Go To
✔✔Common Stock - ✔✔A type of stock that represents equity in a firm and confers the
right to vote at shareholder meetings.Go To
✔✔Compounding - ✔✔Finding a future value given a present value.Go To
✔✔Compounding Interest - ✔✔The interest on the principal plus the interest on earned
interest.Go To
