Finc400 week 3 quiz | Business & Finance homework help

Question 1 of 25

4.0 Points

As a general rule, it is desirable to finance the permanent assets, including “permanent current assets”, with long-term debt and equity.

Question 2 of 25

Short-term interest rates are generally lower than long-term interest rates.

 

Question 3 of 25

4.0 Points

Commercial bank term loans

 

A.usually carry fixed interest rates.

 

B.are very short-term in nature.

 

C.are offered to superior credit applicants.

 

D.both b and c.

 

Question 4 of 25

4.0 Points

       

Dun & Bradstreet is known for providing

A.interest rate information to cash managers.

 

B.credit scoring reports that rank a company’s payment habits relative to its peer group.

 

C.cash management systems to corporate treasurers.

 

D.consumer credit reports to credit card companies

 

Question 5 of 25

4.0 Points

Small companies finance a relatively greater proportion of their assets through trade credit than do larger concerns.

 

 

Question 6 of 25

4.0 Points

 

     
       

A financial executive devotes the most time to

A.Long-range planning.

 

B.Capital budgeting.

 

C.Short-term financing.

 

D.Working capital management.

 

Question 7 of 25

4.0 Points

       

Short-term financing is risky because of the possibility of rising short-term rates and the inability of always being able to refund short-term debt.

 

 

Question 8 of 25

4.0 Points

 

     

From the banker’s point of view, short-term bank credit is an excellent way of financing

 

A.fixed assets.

 

B.permanent working capital needs.

 

C.repayment of long-term debt.

 

D.seasonal bulges in inventory and receivables.

 

Question 9 of 25

4.0 Points

One of the first considerations in cash management is

 

A.to have as much cash as possible on hand.

 

B.synchronization of cash inflows and cash outflows.

 

C.profitability.

 

D.to put any excess cash into accounts receivable.

 

Question 10 of 25

4.0 Points

Cash balances are usually determined by the amount of cash flowing through the firm on a yearly basis.

 

True

False

Question 11 of 25

4.0 Points

 

Seasonal production allows for maximum efficiency in machinery and manpower use.

 

Question 12 of 25

4.0 Points

Even during slack loan periods, banks will never loan out money at an interest rate lower than the prime rate because the prime rate is their best rate.

 

Question 13 of 25

4.0 Points

The use of cash budgeting procedures

 

A.helps the firm plan its current asset levels for a given production plan.

 

 

B.makes managing inventory easier under seasonal production.

 

 

C. illustrates fluctuating levels of current assets for a given production plan.

 

 

D. all of these are correct.

Question 14 of 25

4.0 Points

Permanent current assets are not similar to fixed assets because they are fully liquidated within the year.

 

 

Question 15 of 25                                                                                                       4.0 Points

 

 

     

Modos Company has deposited $3,500 in checks received from customers. It has written $1,400 in checks to its suppliers. The initial bank and book balance was $600. If $1,600 of its customer s checks have cleared but only $600 of its own, calculate its float.

 

A.$1,200

 

B.$1,100

 

C.$300

 

D.$700

 

Bank balance = $600 + $1.600 – $600 = $1,600

Book balance = $600 + $3,500 – $1,400 = $2,700

Float = $1,100

Question 16 of 25

4.0 Points

A Just-In-Time (JIT) inventory management program has all but which of the following requirements?

 

A.quality production

 

B.large safety stocks

 

C.close ties between suppliers, manufacturers, and customers

 

D.minimizing inventory levels

 

Question 17 of 25

4.0 Points

Because of changing economic conditions, it is difficult for companies such as Dun & Bradstreet to devise models predicting payment problems and probability of bankruptcy 12 months in the future.

 

Question 18 of 25

4.0 Points

A trade discount is a percentage reduction from the invoice price given for purchasing certain minimum quantities.

 

Question 19 of 25

4.0 Points

The Truth in Lending law is designed to protect

 

A.corporate borrowers.

 

B.banks.

 

C. consumers.

 

D.investors in municipal bonds.

 

Question 20 of 25

4.0 Points

A “normal” term structure of interest rates would depict

 

A.short-term rates higher than long-term rates.

 

 

B.long-term rates higher than short-term rates.

 

 

C.no general relationship between short- and long-term rates.

 

 

D.Intermediate rates (1-5 years) lower than both short-term and long-term rates.

 

 

Question 21 of 25

4.0 Points

 

       

Bank loans to business firms

 

A.are usually short-term in nature.

 

B.are preferred by the banker to be self-liquidating.

 

C.may require compensating balances.

 

D.all of these.

 

Question 22 of 25

4.0 Points

Normally, permanent current assets should be financed by

 

A.long-term funds.

 

B.short-term funds.

 

C.borrowed funds.

 

D.internally generated funds.

 

Question 23 of 25

4.0 Points

Which of the following is not a valid quantitative measure for accounts receivable collection policies?

A.average collection period

 

B.aging of accounts receivables

 

C.ratio of debt to equity

 

D.ratio of bad debts to credit sales

 

Question 24 of 25

4.0 Points

Working capital management is relatively unimportant for the small business.

 

Question 25 of 25

4.0 Points

For most firms, the primary motive for holding cash is the transaction motive.

 

 

 

 

Calculate Your Essay Price
(550 words)

Approximate price: $22

Calculate the price of your order

550 words
We'll send you the first draft for approval by September 11, 2018 at 10:52 AM
Total price:
$26
The price is based on these factors:
Academic level
Number of pages
Urgency
Basic features
  • Free title page and bibliography
  • Unlimited revisions
  • Plagiarism-free guarantee
  • Money-back guarantee
  • 24/7 support
On-demand options
  • Writer’s samples
  • Part-by-part delivery
  • Overnight delivery
  • Copies of used sources
  • Expert Proofreading
Paper format
  • 275 words per page
  • 12 pt Arial/Times New Roman
  • Double line spacing
  • Any citation style (APA, MLA, Chicago/Turabian, Harvard)

Our guarantees

Delivering a high-quality product at a reasonable price is not enough anymore.
That’s why we have developed 5 beneficial guarantees that will make your experience with our service enjoyable, easy, and safe.

Money-back guarantee

You have to be 100% sure of the quality of your product to give a money-back guarantee. This describes us perfectly. Make sure that this guarantee is totally transparent.

Read more

Zero-plagiarism guarantee

Each paper is composed from scratch, according to your instructions. It is then checked by our plagiarism-detection software. There is no gap where plagiarism could squeeze in.

Read more

Free-revision policy

Thanks to our free revisions, there is no way for you to be unsatisfied. We will work on your paper until you are completely happy with the result.

Read more

Privacy policy

Your email is safe, as we store it according to international data protection rules. Your bank details are secure, as we use only reliable payment systems.

Read more

Fair-cooperation guarantee

By sending us your money, you buy the service we provide. Check out our terms and conditions if you prefer business talks to be laid out in official language.

Read more