Regarding corporate bonds, if the issuing firm does not pledge specific assets as collateral, the bond is called a _. a. debenture b. mortgage c. chattel mortgage d. note ANSWER A
Date: September 19th, 2020
Bacon Signs will have cash receipt of $80,000 in December and cash disbursements in December of $70,000. If its beginning cash is $4,000 and its desired reserve is $15,000, what will Bacon Signs’ cash situation be at the end of December? What will be an ideal response? ANSWER Answer: To know Bacon’s cash […]
Date: September 19th, 2020
Briefly explain the difference between a USE of cash and a SOURCE of cash. Give examples of each. Briefly explain why managers want to know the uses and sources of cash. What will be an ideal response? ANSWER Answer: A source of cash involves cash receipts or cash inflow, while a use of […]
Date: September 19th, 2020
The amount and timing of sales are usually provided by the ________ department. A) advertising or finance B) accounting or sales C) sales or marketing D) marketing or planning c ANSWER Answer: C
Date: September 19th, 2020
We start the process of building a cash forecast with predicting the cash inflow from future sales. This is called ________. A) a sales forecast B) a cash forecast C) a monetary forecast D) an expense forecast ANSWER Answer: A
Date: September 19th, 2020
In theory, a firm’s optimal capital structure is that which minimized the firm’s overall cost of capital resulting in a maximization of the market value of a firm. Indicate whether the statement is true or false ANSWER TRUE
Date: September 19th, 2020
Bond contracts generally include restrictive covenants, designed to protect the interests of the bondholders. Typical covenants restrict all of the following EXCEPT: a. the borrowing firm’s investment activities. b. the borrowing firm’s ability to issue additional debt. c. the borrowing firm’s dividend policy. d. the firm’s hiring of management personnel. ANSWER D
Date: September 19th, 2020
The aggressive funding strategy is risky due to its minimum level of net working capital, high dependency on short-term sources of funds, and the changing short-term interest. Indicate whether the statement is true or false ANSWER TRUE
Date: September 19th, 2020
The amount of sales a company predicts is a function of two types of data. Which of the types below is one of these two types? A) Accounting data B) Internal data C) Rationing data D) Legal data ANSWER Answer: B Explanation: B) The amount of sales a company predicts is a function […]
Date: September 19th, 2020
Based on the sales forecast, the finance manager estimates the receipt of cash based on cash and ________. A) credit sales B) inventory sales C) accounts receivables D) net income ANSWER Answer: A
Date: September 19th, 2020
