Financial Management Answer Key

Chapter 1
1. B
2. A
3. B
4. B
5. C

Chapter 2
1. B
2.

Asset Liability Capital Revenue Expenses

Rent     
Land     
Accounts Payable     
Cash     
Advertising     
Sales     
Accounts Receivable     
Share capital     

3. B

4. B.

Chapter 3
1. C
2. B
3. A
4. C

Chapter 4
1. B
2. C
3. D
 4. A: 25%
B: 25%
5. A C
6. PART 1: B
PART 2: B
PART 3: B
7. A B C
8. A

Chapter 5
1. B C
2. SALES VALUE: $10,200
DIRECT COSTS: $7,840
GROSS PROFIT: $2,360
OVERHEAD: $1,470
PROFIT: $890
PROFIT IMPROVEMENT: 78%
3. D
4. C
5. C
6. F
7. B
8. B
9. CASH: Interest, Collection of receivables, Loan payment
PROFIT: Job costs, Depreciation, Interest, Bad debt expense

Chapter 6
1. C
2. B
3. B
4. B
5. B
6. B
7. B

Chapter 7
1. B
2. B
3. D
4. ABFG
5. D
6. C
 7. B

Chapter 8
1. B
2. B
3. AC
4. AB
5. B
6. C
7. B
8. B