Test Bank for Corporate Finance, 13th Edition by Stephen Ross & Randolph Westerfield – Chapters 1–21

Test Bank for Corporate Finance
13th Edition By Stephen Ross, Randolph Westerfield,
Chapters 1 - 21, Complete




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,Chapter 1

Student name:_
MULTIPLE CHOICE - Choose the one alternative that best completes the statement or
answers the question.
1) Generally, among those who report directly to the are the treasurer and the
controller of a corporation.

A) board of directors
B) chairperson of the board
C) chief executive officer
D) president
E) chief financial officer



2) A typical chain of command in a corporation is described by which one of the following
statements?

A) The information systems manager reports to the treasurer.
B) The credit manager reports to the treasurer.
C) The controller reports to the chief executive officer.
D) The tax manager reports to the treasurer.
E) The capital expenditures manager reports to the controller.



3) Answering which one of the following questions involves making a capital budgeting
decision?




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, A) How much debt should the firm borrow from a particular lender?
B) Should the firm build a new production facility?
C) Should the firm issue new equity to pay for its growth goals?
D) How much inventory should the firm keep on hand?
E) How much credit should the firm extend to a particular customer?



4) Which one of the following statements is accurate?

A) Net working capital equals current assets plus current liabilities.
B) Current liabilities are debts that must be repaid in 18 months or less.
C) Current assets are assets with short lives, such as accounts receivable.
D) Long-term debt is defined as a residual claim on a firm’s assets.
E) Tangible assets are fixed assets such as patents.



5) Among the typical responsibilities of the corporate controller is:
q q q q q q q q




A) capitalexpenditures management.
q q




B) cash management.
q




C) tax reporting.
q




D) financialplanning. q




E) creditmanagement.
q




6) q is typically the responsibility of the corporate treasurer.
q q q q q q q




A) Financialplanning q




B) Cost accounting
q




C) Tax reporting
q




D) Information systems q




E) Financialaccounting q




7) A firm’s
q define(s) its capital structure.
q q q




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, A) mixture of various types of production equipment
q q q q q q




B) investment selections for its excess cash reserves q q q q q q




C) combination of cash and cash equivalents q q q q q




D) combination of accounts appearing on the left side of its balance sheet
q q q q q q q q q q q




E) proportions of financing from debt and equity q q q q q q




8) The focus of short-term finance is on:
q q q q q q




A) the timing of cash flows.
q q q q




B) acquiring and selling fixed assets. q q q q




C) financing long-termprojects. q q




D) capitalbudgeting. q




E) issuing additional shares of common stock.
q q q q q




9) Net working capital includes:
q q q




A) copyrights.
B) manufacturingequipment. q




C) common stock. q




D) long-termdebt. q




E) inventory.



10) q is defined as planning and managing a firm’s long-term assets.
q q q q q q q q q




A) Working capital management q q




B) Cash management
q




C) Cost accounting management
q q




D) Capitalbudgeting q




E) Capitalstructuremanagement
q q




11) An amount the firms owes, which it must repay within twelve months, is called a(n):
q q q q q q q q q q q q q q




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