Fundamentals of
Corporate Finance
ST
5th Edition
UV
TEST BANK
IA
_A
PP
Robert Parrino
RO
David Kidwell
Bates
Gillan
VE
Comprehensive Test Bank for Instructors and Students
D?
© Robert Parrino, David Kidwell, Bates & Gillan
All rights reserved. Reproduction or distribution without permission is prohibited.
?
©MEDCONNOISSEUR
, TEST BANK FOR Fundamentals of Corporate Finance, 5th Edition
Robert Parrino, David Kidwell, Bates & Gillan
UNIT 1: FINANCIAL FOUNDATIONS
ST
1. The Financial Manager and the Firm
2. The Financial System and the Level of Interest Rates
3. Financial Statements, Cash Flows, and Taxes
4. Analyzing Financial Statements
UV
5. The Time Value of Money
UNIT 2: VALUATION AND RETURNS
6. Discounted Cash Flows and Valuation
7. Risk and Return
IA
8. Bond Valuation and the Structure of Interest Rates
9. Stock Valuation
_A
UNIT 3: CAPITAL BUDGETING AND COST OF CAPITAL
10. The Fundamentals of Capital Budgeting
11. Cash Flows and Capital Budgeting
12. Evaluating Project Economics
13. The Cost of Capital
PP
UNIT 4: WORKING CAPITAL, CAPITAL STRUCTURE, AND
PAYOUT POLICY
14. Working Capital Management
RO
15. How Firms Raise Capital
16. Capital Structure Policy
17. Dividends, Stock Repurchases and Payout Policy
UNIT 5: ADVANCED TOPICS IN CORPORATE FINANCE
VE
18. Business Formation, Growth, and Valuation
19. Financial Planning and Managing Growth
20. Options and Corporate Finance
21. International Financial Management
D?
?
©MEDCONNOISSEUR
, TEST BANK FOR:
Fundamentals of Corporate Finance, 5th Edition by Robert Parrino, David Kidwell, Bates &
Gillan. ISBN 9781119795438
ST
Chapter 1-21
Chapter 1 The Financial Manager and the Firm
1) The financial manager is responsible for making decisions that are in the best interests of the
UV
firm's owners.
Answer: TRUE
Diff: 1
Learning Objective: LO 1
Bloomcode: Knowledge
AACSB: Analytic
IA
IMA: FSA
AICPA: Process and Resource Management Perspectives
2) A patent is a productive asset for a technology-based firm.
_A
Answer: TRUE
Diff: 1
Learning Objective: LO 1
Bloomcode: Knowledge
AACSB: Analytic
PP
IMA: Business Economics
AICPA: Global and Industry Perspectives
3) Intangible assets generate most of a manufacturing firm's cash flows.
Answer: FALSE
RO
Diff: 2
Learning Objective: LO 1
Bloomcode: Application
AACSB: Analytic
IMA: Corporate Finance
VE
AICPA: Process and Resource Management Perspectives
4) The most fundamental way a business can grow in size is by reinvesting cash flows or earnings.
Answer: TRUE
Diff: 1
D?
Learning Objective: LO 1
Bloomcode: Knowledge
AACSB: Analytic
IMA: FSA
AICPA: Process and Resource Management Perspectives
?
1
, 5) A firm that goes bankrupt will always be liquidated.
Answer: FALSE
Diff: 2
Learning Objective: LO 1
Bloomcode: Application
ST
AACSB: Analytic
IMA: Corporate Finance
AICPA: Resource Management
UV
6) Capital assets are generally short term in nature.
Answer: FALSE
Diff: 1
Learning Objective: LO 1
Bloomcode: Knowledge
AACSB: Analytic
IA
IMA: Corporate Finance
AICPA: Process and Resource Management Perspectives
7) A good capital budgeting or investment decision is one in which the benefits are worth more to
_A
the firm than the cost of the project.
Answer: TRUE
Explanation: Regardless of the project, a good investment is one in which the benefits are worth
more to the firm than the costs of the asset.
Diff: 2
PP
Learning Objective: LO 1
Bloomcode: Analysis
AACSB: Analytic
IMA: Budget Preparation
AICPA: Resource Management
RO
8) Investment decisions determine how firms raise capital to pay for their investments.
Answer: FALSE
Diff: 1
Learning Objective: LO 1
VE
Bloomcode: Knowledge
AACSB: Analytic
IMA: Investment Decisions
AICPA: Strategic/Critical Thinking
D?
9) Net working capital is the dollar difference between a firm's total current assets and total
liabilities.
Answer: FALSE
Diff: 1
Learning Objective: LO 1
?
Bloomcode: Knowledge
AACSB: Analytic
IMA: Budget Preparation
AICPA: Process and Resource Management Perspectives
2
Corporate Finance
ST
5th Edition
UV
TEST BANK
IA
_A
PP
Robert Parrino
RO
David Kidwell
Bates
Gillan
VE
Comprehensive Test Bank for Instructors and Students
D?
© Robert Parrino, David Kidwell, Bates & Gillan
All rights reserved. Reproduction or distribution without permission is prohibited.
?
©MEDCONNOISSEUR
, TEST BANK FOR Fundamentals of Corporate Finance, 5th Edition
Robert Parrino, David Kidwell, Bates & Gillan
UNIT 1: FINANCIAL FOUNDATIONS
ST
1. The Financial Manager and the Firm
2. The Financial System and the Level of Interest Rates
3. Financial Statements, Cash Flows, and Taxes
4. Analyzing Financial Statements
UV
5. The Time Value of Money
UNIT 2: VALUATION AND RETURNS
6. Discounted Cash Flows and Valuation
7. Risk and Return
IA
8. Bond Valuation and the Structure of Interest Rates
9. Stock Valuation
_A
UNIT 3: CAPITAL BUDGETING AND COST OF CAPITAL
10. The Fundamentals of Capital Budgeting
11. Cash Flows and Capital Budgeting
12. Evaluating Project Economics
13. The Cost of Capital
PP
UNIT 4: WORKING CAPITAL, CAPITAL STRUCTURE, AND
PAYOUT POLICY
14. Working Capital Management
RO
15. How Firms Raise Capital
16. Capital Structure Policy
17. Dividends, Stock Repurchases and Payout Policy
UNIT 5: ADVANCED TOPICS IN CORPORATE FINANCE
VE
18. Business Formation, Growth, and Valuation
19. Financial Planning and Managing Growth
20. Options and Corporate Finance
21. International Financial Management
D?
?
©MEDCONNOISSEUR
, TEST BANK FOR:
Fundamentals of Corporate Finance, 5th Edition by Robert Parrino, David Kidwell, Bates &
Gillan. ISBN 9781119795438
ST
Chapter 1-21
Chapter 1 The Financial Manager and the Firm
1) The financial manager is responsible for making decisions that are in the best interests of the
UV
firm's owners.
Answer: TRUE
Diff: 1
Learning Objective: LO 1
Bloomcode: Knowledge
AACSB: Analytic
IA
IMA: FSA
AICPA: Process and Resource Management Perspectives
2) A patent is a productive asset for a technology-based firm.
_A
Answer: TRUE
Diff: 1
Learning Objective: LO 1
Bloomcode: Knowledge
AACSB: Analytic
PP
IMA: Business Economics
AICPA: Global and Industry Perspectives
3) Intangible assets generate most of a manufacturing firm's cash flows.
Answer: FALSE
RO
Diff: 2
Learning Objective: LO 1
Bloomcode: Application
AACSB: Analytic
IMA: Corporate Finance
VE
AICPA: Process and Resource Management Perspectives
4) The most fundamental way a business can grow in size is by reinvesting cash flows or earnings.
Answer: TRUE
Diff: 1
D?
Learning Objective: LO 1
Bloomcode: Knowledge
AACSB: Analytic
IMA: FSA
AICPA: Process and Resource Management Perspectives
?
1
, 5) A firm that goes bankrupt will always be liquidated.
Answer: FALSE
Diff: 2
Learning Objective: LO 1
Bloomcode: Application
ST
AACSB: Analytic
IMA: Corporate Finance
AICPA: Resource Management
UV
6) Capital assets are generally short term in nature.
Answer: FALSE
Diff: 1
Learning Objective: LO 1
Bloomcode: Knowledge
AACSB: Analytic
IA
IMA: Corporate Finance
AICPA: Process and Resource Management Perspectives
7) A good capital budgeting or investment decision is one in which the benefits are worth more to
_A
the firm than the cost of the project.
Answer: TRUE
Explanation: Regardless of the project, a good investment is one in which the benefits are worth
more to the firm than the costs of the asset.
Diff: 2
PP
Learning Objective: LO 1
Bloomcode: Analysis
AACSB: Analytic
IMA: Budget Preparation
AICPA: Resource Management
RO
8) Investment decisions determine how firms raise capital to pay for their investments.
Answer: FALSE
Diff: 1
Learning Objective: LO 1
VE
Bloomcode: Knowledge
AACSB: Analytic
IMA: Investment Decisions
AICPA: Strategic/Critical Thinking
D?
9) Net working capital is the dollar difference between a firm's total current assets and total
liabilities.
Answer: FALSE
Diff: 1
Learning Objective: LO 1
?
Bloomcode: Knowledge
AACSB: Analytic
IMA: Budget Preparation
AICPA: Process and Resource Management Perspectives
2
