Financial Management Quiz 1

What is the primary goal of financial management?

• Expand market share

• Maximize shareholder wealth

• Minimize expenses

• Increase employee salaries

Which of the following is NOT a key activity in financial management?

• Financial Reporting

• Financial Control

• Financial Decision-Making

• Financial Planning

What does the 'A' in the 5 A's model stand for?

• Assessment

• Allocation

• Acquisition

• Anticipation

Which financial decision involves determining the best investment opportunities?

• Budgeting Decisions

• Investment Decisions

• Financing Decisions

• Operating Decisions

What is vertical analysis used for?

• Comparing financial data over time

• Expressing each item as a percentage of a base figure

• Assessing market trends

• Evaluating cash flow

What does horizontal analysis focus on?

• Assessing market share

• Analyzing a single financial statement

• Evaluating financial data over several periods

• Comparing financial data across different companies

What is the formula for calculating Free Cash Flow (FCF)?

• Net Cash Flow - Operating Expenses

• Total Cash Inflows - Total Cash Outflows

• Operating Cash Flow - Capital Expenditures

• Net Income - Capital Expenditures

Which of the following is a component of the cash conversion cycle?

• Sales Growth Period

• Debt Repayment Period

• Inventory Conversion Period

• Equity Collection Period

What does the current ratio measure?

• Asset utilization

• Long-term solvency

• Short-term liquidity

• Profitability

Which ratio indicates how much profit is earned from each peso of sales?

• Return on Assets

• Current Ratio

• Debt-to-Equity Ratio

• Net Profit Margin