AFM131 - Sample_Final_Exam_Questions

AFM131 - Sample_Final_Exam_Questions - Sample Final Exam...

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Sample Final Exam Questions Question 1 ( 16 marks) Based on your experience with Mike’s Bikes please answer the following: a) Suggest another channel of distribution, other than the one used in the Game, and discuss two reasons supporting this new channel. ( 3 marks ) Direct sales to end customers. The benefit of this approach would be to eliminate the margin paid to retailers, you would have direct access to the end consumer (therefore better informed of their needs), and able to respond on a more timely informed basis to end consumer. Use of wholesalers. You should be able to obtain broader distribution. You will have fewer direct customers to deal with. You will be able to utilize the knowledge and expertise of wholesalers. b) In managing the operating funds for your bike company, discuss two areas you need to be concerned with. ( 4 marks ) Managing day-to-day needs including the paying of: employees; government taxes and withholdings; and suppliers on a timely basis. Controlling credit operations – making decisions on who you will grant credit to, what the terms of the credit arrangements are, and collecting the receivables. Acquiring inventory – making decisions on acquiring inventory considering the trade-off between stock outs through lost sales and having excess inventory. c) Identify one of the types of ratios and comment on how that type of ratio will help you in managing the affairs of your bike company. ( 3 marks )
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Liquidity ratios – measures the ability of a company to meet their obligations when they come due. Leverage / debt ratios – measures the level of risk associated with how assets are financed. Profitability ratios – measures how well resources are being managed to make profits. Activity ratios – measure the effectiveness in managing assets (principally accounts receivable and inventory) Question 2 (12 marks) Answer each of the following questions as they relate to ethics within any business. a) How will employees be able to properly apply ethical principals? ( 2 marks ) Managers and others must be trained to consider the ethical implications of all business decisions. b) How do you make an ethics program work on a day-to-day basis in any business? ( 2 marks ) You set up an ethics office. Employees should be given options to contact someone in the Ethics office or whistle-blowers must feel protected from retaliation. c) What has to happen initially to establish the importance of ethics in any organization? ( 2 marks) Top management must adopt and unconditionally support an explicit corporate code of conduct. d) How will outside stakeholder groups know about your company’s program? (2 marks)
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They are told or informed through some form of communication of your company’s program. e)
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AFM131 - Sample_Final_Exam_Questions - Sample Final Exam...

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