Chapter 18 Quiz

A  amortization installment.

B  repayment scheduling.

C  term loan agreement.

D  revolving line of credit.

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

B  Tax management falls within the responsibility of marketing managers.

C  Taxes represent an inflow of cash to the firm.

D  Profitable businesses usually pay taxes.

A  debt financing and government funds.

B  retained earnings and commercial paper.

C  equity financing and trade credit.

D  debt financing and equity financing.

A  investment banker’s

B  portfolio manager’s

C  CPA’s

D  financial manager’s

A  developing budgets.

B  establishing financial control.

C  forecasting financial needs.

D  preparing financial statements.

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

B  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.

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

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

A  intensity of competition the firm faces with new products.

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

C  general level of market interest rates.

D  current level of government regulations.

A  forecast the impact of technological trends.

B  optimize the firm’s profitability.

C  prepare financial statements for managers.

D  establish budgets for financial control.

A  develop tax strategies.

B  manage accounts payable.

C  manage accounts receivable.

D  audit the company ledgers.

A  trade credit

B  a bond issue

C  commercial paper

D  a revolving credit agreement

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

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

C  loans provided by factors do not require collateral.

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

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

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

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

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

A  indenture agreement.

B  factoring agreement.

C  promissory note.

D  line of credit.

A  Secured credit

B  Factoring

C  Revolving credit

D  Trade credit

A  factor agreement

B  line of credit

C  cash flow conversion

D  renewable income option

A  undervalued inventory

B  a cash flow issue

C  inadequate financial control

D  undercapitalization

A  inability to recruit qualified workers

B  inadequate market control

C  poor advertising messages

D  undercapitalization

A  budgeting.

B  derivatives.

C  planning.

D  control.

A  balance sheet

B  forecast

C  budget

D  income statement

A  depreciated assets

B  stock

C  retained earnings

D  bonds