WorksheetsFP Obj 1.03 Why Money Matters
Total questions: 20
Worksheet time: 7mins
Finance is the business function that involves managing
production.
money.
The goals of the finance function are to ensure profitability and
manufacture raw materials.
reduce risks.
Accounting is distinct from finance because its main focus is on
money management decision
recordkeeping activities.
The administration of assets refers to decisions about
investments.
accounting.
Decisions about financing refer to the
accounting department.
acquisition of funds.
The finance function ensures that the company’s financial goals are
related to product development.
in line with organizational priorities.
How does the finance function relate to company spending?
It plans and controls spending.
It produces reports about spending.
Money the business owes is known as
accounts payable.
assets.
Money owed to the business is known as
accounts receivable.
equity.
To keep communication flowing with other departments, the finance function depends on
marketing.
information systems.
The finance function is usually responsible for which of the following process
Budgeting
Research
The finance function would definitely be involved in a decision regarding
hiring.
new business projects and strategies.
Which of the following is a capital investment decision:
How to finance investments
How to manage inventory
A company’s current balance of assets and liabilities falls under the focus of
working capital management.
the cash conversion cycle.
Determining which projects a business should invest in is known as
capital budgeting.
capital structuring.
Selling shares in the company to raise money for a new venture is referred to as __________ funding.
equity
dividend
Which of the following is a key component of managing working capital:
Cash conversion cycle
Capital budgeting
The cash conversion cycle should be
as short as possible.
at equilibrium.
Which of the following is a measure of how well a business generates cash flow:
Capital structure
Return on capital
When return on capital is positive, the company i
growing in value.
low on cash.
