Quiz_1_-_Ch._1_and__2

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University of Fredericton *

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5015

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Finance

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Jan 9, 2024

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docx

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4

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Started on Wednesday, 7 December 2022, 7:08 PM State Finished Completed on Wednesday, 7 December 2022, 7:21 PM Time taken 13 mins 8 secs Grade 8.00 out of 10.00 ( 80 %) Question 1 Correct Mark 1.00 out of 1.00 Question text 01. What is the primary goal of financial management? Select one: a. Increased earnings b. Maximizing cash flow c. Maximizing shareholder wealth d. Minimizing risk of the firm Feedback The correct answer is: Maximizing shareholder wealth Question 2 Correct Mark 1.00 out of 1.00 Question text 02. One of the major disadvantages of a sole proprietorship is Select one: a. that there is unlimited liability to the owner. b. the simplicity of decision making. c. low organizational costs. d. low operating costs. Feedback The correct answer is: that there is unlimited liability to the owner. Question 3 Incorrect Mark 0.00 out of 1.00
Question text 03. A corporation is Select one: a. owned by shareholders who enjoy the privilege of limited liability. b. easily divisible between owners. c. a separate legal entity with perpetual life. d. all of the other answers are correct Feedback The correct answer is: all of the other answers are correct Question 4 Correct Mark 1.00 out of 1.00 Question text 04. The largest Canadian corporations are mainly Select one: a. widely held. b. family controlled. c. U.S. controlled. d. Japanese controlled. Feedback The correct answer is: widely held. Question 5 Correct Mark 1.00 out of 1.00 Question text 05. Future financial managers will need to understand Select one: a. international cash flows. b. computerized funds transfers. c. international currency hedging strategies. d. all of the other answers are correct. Feedback
The correct answer is: all of the other answers are correct. Question 6 Correct Mark 1.00 out of 1.00 Question text 06. Gross profit is equal to Select one: a. sales minus cost of goods sold. b. sales minus (selling and administrative expenses). c. sales minus (cost of goods sold and selling and administrative expenses). d. sales minus (cost of goods sold and amortization expense). Feedback The correct answer is: sales minus cost of goods sold. Question 7 Correct Mark 1.00 out of 1.00 Question text 07. Which account represents the cumulative earnings of the firm since its formation, minus dividends paid? Select one: a. Share price b. Common stock c. Retained earnings d. Accumulated amortization Feedback The correct answer is: Retained earnings Question 8 Correct Mark 1.00 out of 1.00 Question text 08. The P/E ratio is determined by Select one: a. net worth divided by earnings.
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b. market capitalization divided by earnings. c. net worth per share divided by earnings per share. d. market value per share divided by earnings per share Feedback The correct answer is: market value per share divided by earnings per share Question 9 Incorrect Mark 0.00 out of 1.00 Question text 09. A firm has current assets of $25,000, long term assets of $100,000, long term liabilities of $50,000, and $50,000 in shareholders' equity. What is its net working capital? Select one: a. zero b. $50,000 c. $100,000 d. $25,000 Feedback The correct answer is: zero Question 10 Correct Mark 1.00 out of 1.00 Question text 10. Book value of a firm Select one: a. is usually the same as the firm's market value. b. is based on current asset costs. c. is the same as net worth. d. two of the above Feedback The correct answer is: is the same as net worth.