Corporate Finance - MCQs Chapter 18-19-20-21-25-26

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Sample questions:

11) According to the text, the _____ is generally responsible for making credit policy decisions.

[A] production manager

[B] controller

[C] marketing manager

[D] cash manager

[E] payables manager

 [A] :This manager is generally responsible for setting production schedules and materials requirements. Review section 19.2.  

[B] :This manager performs more of an information and reconciliation function than an actual decision-making function. Review section 19.2.  

[C] :You are correct!  

[D] :This manager is generally responsible for the collection, concentration, and disbursement of cash in addition to managing short-term borrowing relationships. Review section 19.2.  

[E] :This manager generally deals with decisions concerning payment policies and taking discounts offered. Review section 19.2.

 

16) Jumbo, Inc. had sales of $8,000 in November, $14,000 in December, and projects sales of $10,000 in January, $12,000 in February, and $8,000 in March. The firm's COGS in any given month is equal to 70 percent of the next month's sales. The firm collects its receivables in 60 days and pays its payables in 30 days. The firm begins January 1 with $10,000 in cash. All sales and purchases are on credit. There are no other costs or revenues. What are Jumbo's total cash collections in March? Assume there are 30 days in every month.

[A] $10,000

[B] $11,000

[C] $11,600

[D] $12,100

[E] $13,000

 

 [A] :You are correct!

 

Foundations of Finance - MCQs Chapters 1 to 6

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Sample questions:

2. The person generally directly responsible for overseeing the cash and credit functions, financial planning, and capital expenditures is the: 
A. treasurer.
b. director.
c. controller.
d. chairman of the board.
e. chief operations officer.

 

3. The process of identifying projects which will produce positive cash flows is called: 
a. working capital management.
b. financial depreciation.
c. agency cost analysis.
D. capital budgeting.
e. capital structure.

Corporate Finance - MCQs Chapters 10, 11, 15 and 16 - Set 2

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Sample Questions:

1. The changes in a firm's future cash flows that are a direct consequence of accepting a project are called _____ cash flows. 
A. incremental
b. stand-alone
c. after-tax
d. net present value
e. erosion

2. The evaluation of a project based solely on its incremental cash flows is the basis of the: 
a. future cash flow method.
B. stand-alone principle.
c. dividend growth model.
d. salvage value model.
e. equivalent cost principle.

Corporate Finance MCQs for chapters 10, 11, 15 & 16

Download the files at the end of the article

Sample Question

7) Given the following information and assuming straight-line depreciation to zero, what is the internal rate of return of this project? Initial investment = $400,000; life = 4 years; cost savings = $125,000 per year; tax rate = 34 percent; discount rate = 12 percent. The fixed assets will be sold for $20,000 at the end of year 4.

 

[A] 6.25 percent

[B] 7.51 percent

[C] 8.15 percent

[D] 9.43 percent

[E] 10.24 percent

 

Answer: [B]

 

Attached below (in PDF format) are 954 Financial Management MCQs for chapters 1 to 10

Good luck with the exams

Chapter 1:  77
Chapter 2:  77
Chapter 3:  102
Chapter 4:  101
Chapter 5:  70
Chapter 6:  104
Chapter 7:  114
Chapter 8:  101
Chapter 9:  105
Chapter 10: 103

Sample MCQ:

12) Which one of the following is an advantage enjoyed by the owner of a corporation but not by the owner of a sole proprietorship?

 

[A] unlimited liability

[B] ease of formation

[C] unlimited life

[D] double taxation

[E] limited access to capital

 

[A] :Owners of a corporation have limited liability. Review section 1.2.

[B] :A corporation is one of the more difficult organizations to form. Review section 1.2.

[C] :You are correct!

[D] :Double taxation is a disadvantage. Review section 1.2.

[E] :This is a disadvantage of a sole proprietorship. Review section 1.2.

 

 

Attached (Download link at the end) is a quiz for Financial Management chapters 5 to 9.
 
Solutions are at the end of the document
 
Happy reading :)


Example:

1) If prices are increasing at a 2% rate, what is the nominal return on an investment that is purchased for $1,300.00 and sold 1 year(s) later at $1,371.50 ?

   [ ] 5.25%

   [ ] 5.50%

   [ ] 5.75%

   [ ] 6.00%

   [ ] 6.25%

 

Hint: The necessary formula is Price(at year t)/Price(at year 0) = (1 + R)t

 

Solution:

Price(at year t)/Price(at year 0) = (1 + R)t

R = (Price(at year t)/Price(at year 0))1/t - 1

R = (1371.50/1300.00)1/1 - 1

R = 1.055 - 1

R = 0.055 = 5.50% (Answer = B)

Attached (Download link at the end) is a quiz for Financial Management chapters 4 to 10.

Solutions are at the end of the document

Happy reading :)

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