CHAPTER 1 Introduction to Financial Management
I. DEFINITIONS Topic: CORPORATE CONTROLLER
1.The corporate officer generally responsible for tasks related to tax management, cost accounting, financial accounting, and data processing is the: A) Corporate Treasurer. B) Director. C) Corporate Controller. D) Chairman of the Board. E) Vice President of Operations. Answer: C Topic: CORPORATE TREASURER
2.The corporate officer generally responsible for tasks related to cash and credit management, financial planning, and capital expenditures is the: A) Corporate Treasurer. B) Director. C) Corporate Controller. D) Chairman of the Board. E) Vice President of Operations. Answer: A Topic: CAPITAL BUDGETING
3.The process of planning and managing a firm's long-term investments is called: A) Working capital management. B) Financial depreciation. C) Agency cost analysis. D) Capital budgeting. E) Capital structure. Answer: D Topic:
CAPITAL STRUCTURE 4.The mixture of debt and equity used by the firm to finance its operations is called: A) working capital management. B) financial depreciation. C) agency cost analysis. D) capital budgeting. E) capital structure. Answer: E
Topic: WORKING CAPITAL MANAGEMENT
5.The management of the firm's short-term assets and liabilities is called: A) Working capital management. B) Financial depreciation. C) Agency cost analysis. D) Capital budgeting. E) Capital structure. Answer: A
Topic: SOLE PROPRIETORSHIP 6.A business owned by a single individual is called a(n): A) Corporation. B) Sole proprietorship. C) Partnership. D) Closed receivership. E) Open structure. Answer: B Topic: PARTNERSHIP
7.A business formed by two or more individuals or entities is called a(n): A) Corporation. B) Sole proprietorship. C) Partnership. D) Closed receivership. E) Open structure. Answer: C
Topic: CORPORATION 8.A business created as a distinct legal entity