Ch 16

During the development stage of a venture's life cycle, which of the following is not a basis for operating or financial decisions?

• screening business ideas

• preparing the business plan

• obtaining seed financing

• managing the ongoing operations

During the startup stage of a venture's life cycle, which of the following is not a basis for operating or financial decisions?

• creating and building value

• choosing organizational form

• preparing initial financial statements

• obtaining startup financing

During the survival stage of a venture's life cycle, which of the following is not a basis for operating or financial decisions?

• monitoring financial performance

• obtaining seasoned financing

• projecting cash needs

• obtaining first round financing

During the rapid growth stage of a venture's life cycle, which of the following is not a basis for operating or financial decisions?

• creating and building value

• obtaining additional financing

• choosing the organizational structure

• examining exit opportunities

During the maturity stage of a venture's life cycle, which of the following is not a basis for operating or financial decisions?

• managing ongoing operations

• maintaining and adding value

• obtaining seasoned financing

• obtaining seed financing

When a venture's cash on hand is insufficient to pay currently due liabilities, this is referred to as:

• financial distress

• balance sheet insolvency

• bankruptcy

• liquidation

Which of the following refers to the failure to meet loan interest or principal payments when due?

• insolvency

• loan default

• acceleration provision

• cross default provision

• foreclosure

Balance sheet insolvency occurs when a venture has:

a. negative net worth

b. total liabilities greater than total assets

c. negative retained earnings but positive net worth

d. a and b above

e. a, b, and c above

• negative net worth

• total liabilities greater than total assets

• negative retained earnings but positive net worth

Which of the following provides that all future interest and principal obligations on a loan become immediately due when default occurs?

a

b.

c.

d.

e.

• insolvency

• loan default

• acceleration provision

• cross default provision

• foreclosure

Which of the following provides that defaulting on one loan places all loans in default?

• insolvency

• loan default

• acceleration provision

• cross default provision

• foreclosure