Test Bank all Chapter, Answer at the end of

Corporate Finance, 1st (Asia Global Edition) 1e Stephen Ross, Randolph, Westerfield, JeffreyJaffe, Josep Lim Ruth, Tan Helen Wong

( all Chapter, Answer at the end of each Chapter)

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1-1 Chapter 01 Introduction to Corporate Finance

Multiple Choice Questions

• The person generally directly responsible for overseeing the tax management, cost

accounting, financial accounting, and information system functions is the:

• treasurer.
• director.
• controller.
• chairman of the board.
• chief executive officer.

• The person generally directly responsible for overseeing the cash and credit functions,

financial planning, and capital expenditures is the:

• treasurer.
• director.
• controller.
• chairman of the board.
• chief operations officer.

• The process of planning and managing a firm's long-term investments is called:
• working capital management.
• financial depreciation.
• agency cost analysis.
• capital budgeting.
• capital structure.

• The mixture of debt and equity used by a firm to finance its operations is called:
• working capital management.
• financial depreciation.
• cost analysis.
• capital budgeting.
• capital structure.
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Chapter 01 - Introduction to Corporate Finance 1-2

5. The management of a firm's short-term assets and liabilities is called:

• working capital management.
• debt management.
• equity management.
• capital budgeting.
• capital structure.

6. A business owned by a single individual is called a:

• corporation.
• sole proprietorship.
• general partnership.
• limited partnership.
• limited liability company.

• A business formed by two or more individuals who each have unlimited liability for business

debts is called a:

• corporation.
• sole proprietorship.
• general partnership.
• limited partnership.
• limited liability company.

• The division of profits and losses among the members of a partnership is formalized in the:
• indemnity clause.
• indenture contract.
• statement of purpose.
• partnership agreement.
• group charter.
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Chapter 01 - Introduction to Corporate Finance 1-3

• A business created as a distinct legal entity composed of one or more individuals or entities is

called a:

• corporation.
• sole proprietorship.
• general partnership.
• limited partnership.
• unlimited liability company.

• The corporate document that sets forth the business purpose of a firm is the:
• indenture contract.
• state tax agreement.
• corporate bylaws.
• debt charter.
• articles of incorporation.

11. The rules by which corporations govern themselves are called:

• indenture provisions.
• indemnity provisions.
• charter agreements.
• bylaws.
• articles of incorporation.

• A business entity ope and taxed like a partnership, but with limited liability for the

owners, is called a:

• limited liability company.
• general partnership.
• limited proprietorship.
• sole proprietorship.
• corporation.
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