WorksheetsFinancial Management Quiz
Total questions: 30
Worksheet time: 15mins
Which of the following best describes the main focus of financial management in a corporation?
Minimizing the number of shareholders
Maximizing the market value of the shares of stocks
Reducing the price of stocks
Increasing the number of employees
According to the module, what is a key reason why financial management is necessary for both individuals and companies?
To increase the number of resources
To ensure resources are not wiped out due to poor management
To reduce the need for planning
To avoid paying taxes
Based on the illustration, what does the market value of shares represent for shareholders?
The total number of shares traded
The value of the shareholders’ wealth
The company’s annual profit
The number of employees in the company
Which of the following is the overriding objective of management according to finance literature?
Profit maximization
Sales maximization
Shareholders’ wealth maximization
Market share maximization
Which unit in the course outline covers the concept of the Time Value of Money?
Unit I: Introduction to Financial Management
Unit IV: Sources and Uses of Short-term, and Long-term Funds
Unit V: Basic Long-term Financial Concepts
Unit VI: Introduction to Investments
Which of the following is NOT listed as a factor that can influence the price of a stock?
Projected earnings
Dividend policies
Employee satisfaction
Market sentiment
Why might the concept of shareholders’ wealth maximization be difficult to apply in closely held corporations?
There is no market price of the stock to look at
The company has too many shareholders
The company is always profitable
The company does not issue dividends
According to the course outline, which unit would most likely cover the duties of the borrower to creditors?
Unit II: Review of Financial Statements Preparation, Analysis, and Interpretation
Unit IV: Sources and Uses of Short-term, and Long-term Funds
Unit VI: Introduction to Investments
Unit VII: Managing Personal Finance
Maximizing shareholders’ wealth is considered a more comprehensive objective than profit maximization because:
It only focuses on short-term profits.
It considers the different facets of operating a company and the interests of various stakeholders.
It ignores the risks associated with business decisions.
It is easier to measure than profit maximization.
What is the main reason profit maximization should not be the overriding objective of a company?
It always leads to higher share prices
It may force management to borrow more, increasing bankruptcy risk
It guarantees long-term growth
It ensures compliance with government regulations
Why might management defer important repairs and maintenance, and what is a potential consequence of this action?
To increase long-term profits; may improve efficiency
To show better profits in the current period; may impair efficiency in the long run
To comply with government regulations; may reduce costs
To support the host community; may increase productivity
In terms of claim over assets upon liquidation, who has preference: bondholders, common stockholders, or preferred stockholders?
Common stockholders
Preferred stockholders
Bondholders
All have equal preference
According to the organizational chart, to whom does the VP for Finance directly report?
Board of Directors
President
VP for Sales and Marketing
VP for Administration
Which of the following is NOT one of the companies listed for the supplemental learning activity on stock price movements?
PLDT
Globe Telecom
Jollibee Foods Corporation
Ayala Land
What is the required font type for the supplemental learning activity paper?
Arial
Times New Roman
Century
Calibri
What is one of the main responsibilities of the President in a corporation?
Identifying adequate and competitively priced raw materials
Overseeing the operations of a company and ensuring strategies are implemented
Directing and coordinating company sales
Determining the location and maximum amount of office space needed
Which of the following tasks is typically performed by the VP for Sales and Marketing?
Providing assistance in payroll preparation
Analyzing and evaluating effectiveness and cost of marketing methods applied
Approving information reported in financial statements
Identifying production technology that minimizes cost
Which of the following is a function of the VP for Finance?
Operating
Market analysis
Production planning
Hiring employees
(DoK Level 2) If a company wants to minimize its operating costs, which executive is primarily responsible for identifying means, processes, or systems to achieve this?
VP for Sales and Marketing
VP for Administration
VP for Production
President
(DoK Level 2) A company is considering how much of its total assets should be financed by debt and equity. Which function of the VP for Finance does this decision relate to?
Investing
Operating
Financing
Dividend policies
(DoK Level 3) Suppose a company is facing high production costs and wants to remain competitive. Which responsibility of the VP for Production should be prioritized, and why?
Ensuring production meets customer demands, because it increases sales
Identifying production technology/process that minimizes production cost, because it helps the company stay competitive
Coming up with a production plan, because it maximizes facility utilization
Identifying competitively priced raw materials, because it ensures quality
Which of the following is NOT one of the three factors affecting the declaration of dividends?
Availability of investment opportunities
Access to long-term sources of funds
Capital structure
Market share growth
Which of the following is a component of the Statement of Changes Stockholder’s Equity?
Profit or loss for the accounting period
Inventory turnover ratio
Depreciation expense
Accounts receivable aging
Which of the following is NOT a step in the review of financial statement preparation?
Analyzing business transactions
Recording in the journals
Posting to ledger accounts
Conducting market research
A company’s liquidity is determined by comparing its current assets with which of the following?
Current liabilities
Total revenue
Shareholder equity
Long-term investments
Which statement provides information regarding the revenues, expenses, and net income of a company over a given period?
Statement of Financial Position
Statement of Profit or Loss
Statement of Cash Flows
Statement of Changes Stockholder’s Equity
If a company issues new shares of stock, which financial statement will reflect this change?
Statement of Financial Position
Statement of Profit or Loss
Statement of Cash Flows
Statement of Changes Stockholder’s Equity
What is the purpose of providing a brief description of the company in the notes to financial statements?
To include the nature of business and owners behind the company
To list all company products
To summarize annual sales
To describe marketing strategies
Which ratio is used to measure a company's ability to pay its short-term obligations?
Return on Equity
Current Ratio
Debt Ratio
Gross Profit Margin
If a company wants to analyze how efficiently it collects payments from customers, which ratio should it use?
Accounts receivable turnover ratio
Debt Ratio
Return on Assets
Acid-test Ratio
