Practice Test Chapter 7

Practice Test Chapter 7 - CHAPTER 7 Assessing a New...

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CHAPTER 7 Assessing a New Venture’s Financial Strength And Viability MULTIPLE-CHOICE QUESTIONS Introduction to Financial Management Answer: C Easy Page: 148 1. Financial management deals with two things: A. operations management and procurement B. warehousing and managing a company’s finances C. raising money and managing a company’s finances D. production management and raising money E. marketing and production management Answer: D Easy Page: 148 2. Financial management deals with two things -- raising money and: A. operations management B. production management C. warehousing D. managing a company’s finances E. operations management Answer: E Easy Page: 149 3. Which of the following was not identified as one of the four main financial objectives of a firm? A. profitability B. liquidity C. efficiency D. stability E. timeliness Answer: E Easy Page: 149 4. The four main financial objectives of a firm are: A. efficiency, effectiveness, strength, and flexibility B. power, success, efficiency, and effectiveness C. control, effectiveness, liquidity, and power D. success, strength, liquidity, and profitability E. profitability, liquidity, efficiency, and stability
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Chapter 7: Assessing A new Venture’s Financial Strength And Viability Answer: A Easy Page: 149 5. __________ is the ability to earn a profit. A. Profitability B. Liquidity C. Efficiency D. Effectiveness E. Stability Answer: D Medium Page: 149 6. A company’s ability to meet its short-term financial obligations is referred to as: A. stability B. efficiency C. effectiveness D. liquidity E. profitability Answer: B Medium Page: 149 7. A company’s __________ is money owned to it by its customers. A. liquidity B. accounts receivable C. accounts payable D. inventory E. owners’ equity Answer: C Medium Page: 149 8. Peggy Wilson owns a barbeque restaurant in Atlanta. She is currently owed $8,000 by a corporation that she catered a meeting for and $3,000 on an overdue account. Peggy has $11,000 in: A. accounts payable B. liquidity C. accounts receivable D. owners’ equity E. inventory Answer: A Medium Page: 149 9. A company’s __________ is its merchandise, raw materials, and products waiting to be sold. A. inventory B. liquidity C. accounts receivable D. accounts payable E. owners’ equity 2
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Chapter 7: Assessing A New Venture’s Financial Strength And Viability Answer: E Medium Page: 149 10. Kelly Byer owns a store that sells exercise equipment. Each January 1, he makes a very accurate account of all his merchandise and products waiting to be sold that are in his store. On January 1, Kelly is taking account of his store’s: A. long-term assets B. owners’ equity C. accounts payable D. accounts receivable E. inventory Answer: A Medium Page: 149 11. __________ is how productively a firm utilizes its assets relative to its revenue and its profits. A.
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This note was uploaded on 06/12/2011 for the course MNGT 305 taught by Professor Chadwick during the Spring '11 term at Nicholls State.

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Practice Test Chapter 7 - CHAPTER 7 Assessing a New...

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