ChancellorOxide9140
What is an example of a non-deposit Institution? Mutual…
What is an example of a non-deposit Institution?
Mutual savings bank
Credit union
Securities and investment dealer
Commercial bank
Which of the following is true regarding risk management?
Pure risk typically results in potential gains for an organization.
Speculative risks are usually associated with natural disasters.
Large and small companies need to manage issues with speculative risks.
Large companies are more likely to require risk management plans.
Meredith created organic soaps and lotions and sold them at her local farmers’ market. She originally only accepted cash or checks from her customers, but she recently updated her booth space so that her customers could make electronic payments using debit or credit cards.
Which of the following types of service did Meredith begin using?
Point of sale terminal
Automated clearing house
Electronic check conversion
Automatic teller machine
Jenna and the partners in her firm met with an entrepreneur who owned a company that needed funding. Jenna led her team in closely evaluating the company’s financial documents to determine if the project would be too risky to invest in. Jenna’s group was interested in helping a company grow rather than just getting it started.
Which of the types of investor below is described in this scenario?
Venture capitalist
Personal investor
Lending institution
Angel investor
A well-known corporation planned to expand one of their product lines and needed financing. The corporation wanted financing that could be quickly arranged. All information about the financing needed to be kept confidential so their competitors would not find out about the expansion.
Which of the following types of financing is the company likely to use?
Corporate bond
Stock offering
Venture capitalist
Long term loan
Which of the following is true regarding reserve requirements?
Higher reserve requirements mean banks have less money to lend.
Higher reserve requirements mean banks have more money to lend.
Lower reserve requirements mean consumers have more difficulty borrowing money.
Lower reserve requirements mean banks must hold more money in cash or deposit.
Financial accounting is different from managerial accounting in which of the following ways?
Financial accounting involves creating financial documents for people to use within an organization.
Financial accounting provides financial information to people outside of an organization.
Financial accounting is used by an organization to make financial plans for the future.
Financial accounting sets the performance goals for every division within a business.
Which of the following does a high debt to owner’s equity ratio signal?
The company assumes too much risk.
The company relies too much on debt.
The company is not credit worthy.
The company is able to pay off current debts.
Which of the following can investors use to evaluate a company’s potential earning power?
Debt to owner’s equity ratio
Earnings per share
Current ratio
Asset to liabilities ratio
When a credit-worthy business takes on an unsecured, short term loan, which kind of interest rate below will it likely be charged?
Annual percentage rate
Prime percentage rate
Prime percentage rate plus a percent
Discount rate
Which of the following is true about a budget?
It is used to compare the assets of a business to its liabilities.
It is shared with investors to verify the financial health of a business.
It is used to monitor the costs of potential business risks.
It is used to balance financial priorities with organizational goals.
Which of the types of short term loans below requires the borrower to pay a specific amount of money to the lender on a specific date?
Promissory note
Trade credit
Debenture bond
Mortgage bond
Which of the following is a characteristic of common stock?
Owners of common stock are the last group of investors to be paid earnings.
Owners of common stock are paid earnings before other investors.
Owners of common stock have voting rights for all company issues.
Owners of common stock pay a higher capital gains tax than other investors.
Which of the following best describes the Federal Reserve?
It serves as a bank for the government.
It backs insurance policies that protect businesses.
It takes deposits from consumers.
It provides loans to different organizations.
A company created a set of policies and procedures for a manufacturing facility to reduce the likelihood of workplace accidents.
Which of the types of risk management below does this scenario describe?
Risk retention
Risk transfer
Risk control
Risk avoidance
Which of the following happens when the supply of money is high?
Investors are less willing to purchase stocks.
The economy is considered to be unhealthy.
The value of money goes down.
Banks are less willing to lend money.
Which of the following is true, regarding the risk return relationship?
A conservative investment is the riskiest type of investment.
An aggressive investment is less likely to involve a lot of risk.
A conservative investment is more likely to have the highest return.
An aggressive investment is likely to have the highest return.
Which of the following is an example of a liability listed on a balance sheet?
Depreciation amount for a piece of equipment
Long term value of land owned by the company
Debt to be paid within the next year
Monetary value of the company’s brand
Which of the types of companies below is more likely to use secured short term financing?
A company with an excellent credit history
A company that provides services rather than products
A company with a poor credit rating
A company that has little collateral to provide to obtain a loan
Colin was a manager for EST Corporation, and the company wanted to expand into a new region. Colin analyzed data to determine how much money the company could make from the expansion within two years.
Which responsibility of financial management below did Colin demonstrate?
Evaluated short term financing options for the expansion
Evaluated trends in the market the company would enter
Prepared the income statement for external users to review
Evaluated immediate cash flow issues from different departments
