Review of Financial Objectives

Select all of the financial objectives:

• Revenue, cost, and profit

• Cash flow

• Investment

• Capital structure

• Interest rates

True or false. Financial objectives need to consistent with other functional objectives and align to the overall corporate objectives.

• True

• False

For a single product, what is the formula for Revenue

• Price/Quantity

• Price x Quantity

• Price + Quantity

• Price - Quantity

• Quantity/Price

True or False: Revenue objectives may be used by businesses seeking to build a customer base and establish themselves in a chosen market.

• True

• False

True or False. A disadvantage of revenue objectives is that increasing revenue does not necessarily increase a business’s profits.

• True

• False

True or false. Cost minimisation seeks to reduce the lowest possible level of production that a business incurs as part of its trading activities.

• True

• False

What is the term for the movement of cash into and out of a business over a period of time?

• Cash flow

• Cash cycle

• Overtrading

• Investment

• Capital structure

What is the time that elapses between the outflow of cash and the receipt of cash from the sale of the product or service?

• Cash flow

• Cash cycle

• Overtrading

• Investment

• Capital structure

True or False. Without cash, a business is unable to meet its financial commitments as they fall due.

• True

• False

Fill in the blank. Businesses with ________ cash cycles are more susceptible to cash flow problems and possible business failure.

• Long

• Short

• Nonexistent

• None of the answers