Chapter 18 Quiz

A  repayment scheduling.

B  revolving line of credit.

C  term loan agreement.

D  amortization installment.

A  Taxes represent an inflow of cash to the firm.

B  Taxes cannot be managed because of fluctuations in political policy.

C  Profitable businesses usually pay taxes.

D  Tax management falls within the responsibility of marketing managers.

A  debt financing and equity financing.

B  equity financing and trade credit.

C  retained earnings and commercial paper.

D  debt financing and government funds.

A  CPA’s

B  financial manager’s

C  investment banker’s

D  portfolio manager’s

A  developing budgets.

B  preparing financial statements.

C  establishing financial control.

D  forecasting financial needs.

A  A large corporation that has been hit with a major lawsuit because one of its products has a design flaw that has led to serious injuries.

B  A new company struggling because it has insufficient start-up funds.

C  A medium-sized company that has decided to buy out a smaller competitor.

D  An electric utility that has recently experienced a significant increase in the cost of coal and labor.

A  current level of government regulations.

B  general level of market interest rates.

C  exchange rate of the euro to the U.S. dollar.

D  intensity of competition the firm faces with new products.

A  forecast the impact of technological trends.

B  prepare financial statements for managers.

C  optimize the firm’s profitability.

D  establish budgets for financial control.

A  manage accounts payable.

B  audit the company ledgers.

C  manage accounts receivable.

D  develop tax strategies.

A  a revolving credit agreement

B  a bond issue

C  commercial paper

D  trade credit

A  factoring provides a much cheaper source of funds than bank loans.

B  loans provided by factors do not require collateral.

C  interest paid to a factor qualifies for a tax credit.

D  small firms often find it difficult to qualify for bank loans.

A  the inability to utilize factoring as a source of financing.

B  the realization that many credit customers always pay their bills.

C  the large amount of assets tied up in accounts receivable.

D  the resulting increase in the debt ratio for the firm.

A  indenture agreement.

B  factoring agreement.

C  line of credit.

D  promissory note.

A  Revolving credit

B  Trade credit

C  Secured credit

D  Factoring

A  line of credit

B  cash flow conversion

C  renewable income option

D  factor agreement

A  inadequate financial control

B  a cash flow issue

C  undervalued inventory

D  undercapitalization

A  poor advertising messages

B  inability to recruit qualified workers

C  inadequate market control

D  undercapitalization

A  budgeting.

B  planning.

C  control.

D  derivatives.

A  balance sheet

B  budget

C  income statement

D  forecast

A  stock

B  bonds

C  depreciated assets

D  retained earnings