Chapter 18 Quiz

A  amortization installment.

B  revolving line of credit.

C  repayment scheduling.

D  term loan agreement.

A  Taxes represent an inflow of cash to the firm.

B  Tax management falls within the responsibility of marketing managers.

C  Profitable businesses usually pay taxes.

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

A  equity financing and trade credit.

B  retained earnings and commercial paper.

C  debt financing and equity financing.

D  debt financing and government funds.

A  investment banker’s

B  CPA’s

C  financial manager’s

D  portfolio manager’s

A  preparing financial statements.

B  forecasting financial needs.

C  developing budgets.

D  establishing financial control.

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

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

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

D  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.

A  current level of government regulations.

B  intensity of competition the firm faces with new products.

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

D  general level of market interest rates.

A  optimize the firm’s profitability.

B  prepare financial statements for managers.

C  forecast the impact of technological trends.

D  establish budgets for financial control.

A  develop tax strategies.

B  audit the company ledgers.

C  manage accounts payable.

D  manage accounts receivable.

A  trade credit

B  commercial paper

C  a bond issue

D  a revolving credit agreement

A  loans provided by factors do not require collateral.

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

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

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

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

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

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

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

A  promissory note.

B  line of credit.

C  factoring agreement.

D  indenture agreement.

A  Factoring

B  Revolving credit

C  Trade credit

D  Secured credit

A  renewable income option

B  cash flow conversion

C  factor agreement

D  line of credit

A  a cash flow issue

B  undervalued inventory

C  inadequate financial control

D  undercapitalization

A  undercapitalization

B  inadequate market control

C  poor advertising messages

D  inability to recruit qualified workers

A  budgeting.

B  planning.

C  control.

D  derivatives.

A  budget

B  forecast

C  balance sheet

D  income statement

A  stock

B  retained earnings

C  depreciated assets

D  bonds