Financial Management (C214) - PA

Financial Management (C214) - PA 5.0 (3 reviews) Students also studied Terms in this set (69) Western Governors UniversityC 214 Save WGU C214 Concepts Only Multi Cho...222 terms ctcaw259Preview WGU C211 - Global Economics for M...136 terms jasonmcnearPreview WGU C214 Concepts Only Multi Cho...Teacher 222 terms Lydia_Smith75 Preview WGU C Teacher MB How can a private firm appropriately maximize shareholder value?

• By increasing the firm’s stock price
• By reducing the firm's labor
• By making decisions that keep the control of the

business with the owners By making decisions that keep the control of the business with the owners Why are American regulators focused on international investing in a global marketplace?

• Because international investing in a global marketplace

is the concern of American investors

• Because an exclusively domestically focused regulatory

approach is still effective

• Because weaving international concerns into domestic

policy is cost-effective

• Because other jurisdictions have the same priorities and

solutions as the United States Because international investing in a global marketplace is the concern of American investors What is one of the two basic types of financial instruments?

• Checking accounts
• Bonds
• Euros
• Hedge funds

Bonds

What are the likeliest outcomes if a company outsources the manufacturing of its products to a foreign country?Choose 2 answers.

• Consumer prices will decrease.
• Tariffs will decrease.
• Domestic wages will increase.
• Production capacity will decrease.
• Domestic employment will decrease.

Consumer prices will decrease.Domestic employment will decrease.What do the content and structure of a balance sheet report?

• The gains and losses at a point in time
• The revenues and expenses for a period of time
• The assets, liabilities, and equity at a point in time
• The expenses, assets, and liabilities for a period in time

The assets, liabilities, and equity at a point in time A company reported an increase in accounts receivable of $5,000 during the recent period. Half of this amount is expected to be collected next period.How will this change in accounts receivable affect the cash flows from the operating activities section?

• The change will decrease cash flows from operations by

$2,500.

• The change will increase cash flows from operations by

$2,500.

• The change will increase cash flows from operations by

$5,000.

• The change will decrease cash flows from operations by

$5,000.

The change will decrease cash flows from operations by $5,000.Which statement accurately explains the recognition of revenues and expenses under accounting income and income for tax purposes?Revenue and expenses recognized must be matched with assets.Revenue and expenses recognized must be matched with liabilities.Revenues and expenses may be recognized in one period for accounting income purposes and in a different period for income tax purposes.Revenues and expenses are always recognized in the same period for accounting income purposes and income for tax purposes.Revenues and expenses may be recognized in one period for accounting income purposes and in a different period for income tax purposes.

Selected Data for 20x2 for ABD Inc.Net Income$ 1,000Depreciation Expense$ 300 Change in Operating Assets$ 600 Change in Net Property, Plant, and Equipment$ 5,000 Changes in Long-Term Liabilities$ 1,000 Dividends Paid$ 200 What is this firm’s cash flow from investments, using the data above and assuming no asset disposals?$5,000 inflow $5,000 outflow $5,300 inflow $5,300 outflow $5,300 outflow What is the basic equation for a balance sheet?Revenue + expenses = income Assets = Liabilities − Equity Revenue + Assets = Equity Assets = Liabilities + Equity Assets = Liabilities + Equity What do cash flows from investing activities generally relate to?A firm’s debt and equity transactions A firm’s purchase and sale of long-term assets A firm’s sale of goods and services A firm’s non-cash transactions A firm's purchase and sale of long-term assets Which transaction is reflected in cash flow from operating activities?Amortization expense Gain or loss on the sale of property, plant, and equipment Credit sales to customers Cash sales to customers Cash sales to customers

What does free cash flow represent?Cash flows from operating activities Cash balance at the end of the period Cash available for distribution after funding required reinvestment Cash available for dividends Cash available for distribution after funding required reinvestment An analyst is comparing the ratios of two firms and needs to address timing differences What is an example of a timing difference between these two firms?The firms have different fiscal years.The firms are in different industries.The firms use different depreciation methods.The firms use different inventory methods.The firms have different fiscal years.A company’s year-end balance sheet for 2013 shows the

following:

Accounts Receivable: $900

Inventory: $1,200

Fixed Assets: $1,000

Accounts Payable: $1,300

Sales: $4,000

Salaries Expense: $275

What is its fixed asset turnover ratio?

1.7 1.8 3.7 4.0 4.0