Finance quick test by pSH

Financial assets can be distinguished from real assets in that financial assets

• are pieces of paper rather than tangible, physical objects.

• are intended to provide services like transportation or shelter.

• don't really have value because they provide their owners with claims to future cash flows.

The principal legal difference between a stockholder and a bondholder is

• the stockholder receives interest and the bondholder receives dividends

• only the bondholder can attend annual meetings

• the bondholder has an ownership interest and the shareholder is a lender

• the shareholder has an ownership interest and the bondholder is a lender

Companies finance the purchase of assets through

• all of the listed answers are correct

• debt financing, the sale of bonds

• equity financing, the sale of stock

• lease financing

• borrowing money from a bank

Investments in financial assets can be made directly by buying shares in a mutual fund

• True

• False

Financial management involves

• financial input for general business decisions

• providing oversight for the management of money in other departments

• judging the feasibility of projects

• all of the answers are correct

• none of the answers are correct

Which of the following would cause a increase in cash

• Lengthening the time it takes to collect receivables from 15 to 30 days

• Selling fixed assets for more than book value

• An increase in accrued salaries expense

• Paying suppliers in 60 days versus 45 days

• all of the listed answers are correct

A source of cash would be generated by which of the following

• An increase in accounts receivable

• An increase in inventory

• A decrease in accrued expenses

• An increase in accounts payable

• none of the answers are correct