1. The document is a midterm exam in business finance covering topics like financial planning, financial statements, and budgeting.
2. It contains 20 multiple choice questions testing concepts such as liquid assets, investments, dividends, working capital, and financial projections.
3. The questions also refer to financial statements of a sample company and ask students to calculate projected sales, costs of sales, and production levels based on the given information.
1. The document is a midterm exam in business finance covering topics like financial planning, financial statements, and budgeting.
2. It contains 20 multiple choice questions testing concepts such as liquid assets, investments, dividends, working capital, and financial projections.
3. The questions also refer to financial statements of a sample company and ask students to calculate projected sales, costs of sales, and production levels based on the given information.
1. The document is a midterm exam in business finance covering topics like financial planning, financial statements, and budgeting.
2. It contains 20 multiple choice questions testing concepts such as liquid assets, investments, dividends, working capital, and financial projections.
3. The questions also refer to financial statements of a sample company and ask students to calculate projected sales, costs of sales, and production levels based on the given information.
Maunlad St., Pinyahan, Quezon City 14. Part of these plans are acquisition of fixed assets, research PERIODICAL EXAMINATION IN and development activities, marketing and product BUSINESS FINANCE development actions, capital structure, and major sources of 1st Quarter (Midterm Exam) financing. A. Long-term financial plans I. Multiple choices: Choose the letter of the correct answer B. Financial planning and write it on your answer sheet. NO ERASURES. USE C. Short-term financial plans CAPITAL LETTERS ONLY. D. Business plan 15. It is a schedule which provides information regarding the 1. Are assets that can be easily be converted into cash. number of units that should be produced over a given A. Intangible assets C. Fixed assets accounting period based on expected sales and targeted level B. Liquid assets D. Non-current assets of ending inventories. 2. It is the act of putting money, effort and time into A. External Funds Needed C. Sales Budget something to make a profit. B. Working Capital D. Production Budget A. Investment C. Budgeting 16. JVP Company plans to set their sales forecast and other B. Planning D. Wealth maximization forms of operating and financial data. What kind of financial 3. Payment made by a corporation to its shareholders, usually plan is this? as a distribution of profits. A. Long-term financial plans A. Salary C. Tax B. Financial planning B. Net Profit D. Dividend C. Short-term financial plans 4. Are liquid assets whose value are derived from a contractual D. Business plan claim. 17. It is the management’s estimate of sales for a future A. Tangible asset C. Intangible asset financial period. Contains an itemization of a company’s sales B. Non-current asset D. Financial asset expectations for the budget period. 5. A type of bank that provide services such as accepting A. External Funds Needed C. Sales Budget deposits, making business loans, and offering basic B. Working Capital D. Production Budget investment products that is operated as a business for 18. It is the amount of money a company must raise from profit. external sources to finance the increase in assets required to A. Commercial bank C. Thrift bank support increased level of sales. B. Rural bank D. Quasi-bank A. External Funds Needed C. Retained Earnings 6. The capital of a business which is used in its day-to-day B. Operating Income D. Dividend Payout operation. 19. In making financial projections, always start with the A. Market sentiment C. Working capital statement of profit or loss and the most important account to B. Profitability D. Wealth maximization forecast first is _________. 7. Assets that have long-term physical existence or is acquired A. Asset C. Sales for use in the operation of the business and not for sale to B. Capital D. Expenses customers. 20. Determine the number of units to be produced in 2016 A. Tangible assets C. Current assets given the following information: B. Non-current assets D. Accounts Receivable I. Inventories at the Beginning of the Year = 250,000 units 8. A bank that provides a wide variety of financial services, II. Projected Sales in 2016 = 5,750,000 units including commercial and investment services. III. Target Level of Ending Inventories = 400,000 units A. Commercial bank C. Thrift Bank B. Rural bank D. Universal bank A. 5,600,000 units C. 5,100,000 units 9. Refers to how asset can easily be converted into cash to pay B. 5,900,000 units D. 5,000,000 units immediate and short-term obligation. A. Leverage C. Profitability For items 21-22 refer to the paragraph below about Financial B. Solvency D. Liquidity Planning: 10. The highest policy making body in a corporation. A. Shareholder C. Board of Director Below are the summarized financial statements of HirapNoh B. Board of Trustees D. Stockholder Company for 2018. 11. Are often owned by family members, group of individuals or relatively small number of shareholders which do not 2018 offer or trade its company stocks to the general public. Sales 52,501,085 A. Private banking institution Cost of Sales 41,954,730 B. Public banking institution Gross Profit 10,546,355 C. Privately owned corporations D. Publicly owned corporations Operating Expenses 6,497,659 12. It is a place where the creation and trading of financial Operating Income 4,048,696 assets take place. Interest Expense 250,000 A. Financial Market C. Banking Institution Income before taxes 3,798,696 B. Stock Market D. Financial Intermediaries Taxes 1,139,609 13. Is an entity that acts as the middleman between two Net Income 2,659,087 parties in a financial transactions. A. Financial Market C. Banking Institution 21. Sales are expected to increase by 10% in 2019 from the B. Stock Market D. Financial Intermediaries 2018 sales level. What will be the projected sales for 2019? A. 47,250,977 C. 57,751,194 B. 5,250,109 D. 55,517,149 22. What will be the Projected Cost of Sales in 2019? 38. It is a tool of the company to set an overall goal of what A. 46,148,979 C. 46,200,955 the company’s performance and position will be for and as of B. 50,498,878 D. 56,200,955 the end of the year. 23. It is the most liquid asset of a company. A. forecasting C. budgeting A. Accounts Receivable C. Land B. Inventory D. Projected Financial Statement B. Current Asset D. Cash 39. Components of a firm’s cash conversion cycle include: 24. Refers to how much of your total assets is finance by debt A. average collection period, average of inventory and how much is financed by equity B. average payment, average collection period A. Dividend Policies C. Retained earnings C. average age of inventory and average payment B. Capital structure D. Long-term investment period 25. If we used the money from our borrowings, the asset D. average age of inventory, average collection bought is financed by _________________. period, and average payment A. Equity C. Debt 40. The following are the accounts of KayaPaBa Company. B. Raw materials D. Dividends How much is the Net Working Capital? 26. The role of the __________________ is to determine the appropriate capital structure of the company. A. VP for Marketing C. VP for Production B. VP for Finance D. VP for Administration 27. A combination of multiple business entities operating in entirely different industries under one corporate group. A. P235,000 C. P160,000 A. Business C. Corporation B. P95,000 D. P105,000 B. Conglomerate D. Partnership 41. In what order will a company’s current assets appear on a 28. Any contract that evidences a residual interest in the classified balance sheet? assets of an entity after deducting all liabilities A. Alphabetical order C. Company’s choice A. Equity instrument C. Debt instrument B. Order of Liquidity D. Largest to smallest amount B. Financial asset D. Dividend 42. Which of the following would not be financed from 29. It provides policy directions in the areas of money, Working Capital? banking, and credit. It supervises operations of banks and A. Computer equipment C. Office Supplies exercises regulatory powers over non-bank financial B. Building D. Service Vehicle institutions with quasi-banking functions. 43. It combines the services of a commercial bank an A. Board of Directors C. Banks investment bank, providing all services from within one entity. B. Bangko Sentral ng Pilipinas D. Pawnshops A. Commercial Bank C. Thrift Bank 30. A bank that specializes in offering savings account and B. Universal Bank D. Rural Bank mortgage loans to consumers. 44. The amount of money a company must raise from external A. Commercial Bank C. Thrift Bank sources to finance the increase in assets required to support B. Universal Bank D. Rural Bank increased level of sales. 31. A financial market in which new issues of security are sold A. Initial Public Offering C. Capital to initial buyers. B. External Funds Needed D. Loan A. Money Market C. Capital Market 45. Covers the period from the time the merchandise is bought B. Primary Market D. Secondary Market to the time the proceeds from the sale are collected. 32. Refers to the process of offering shares of private A. Cash Conversion Cycle C. A/R Turnover corporation to the public in a new stock issuance for the first B. Inventory Turnover D. Operating Cycle time. 46. Given the following accounts: A. Sharing is caring C. Stock Trading Cost of Sales: P 60,000 B. Underwriting D. Initial Public Offering Beginning Inventory: 10,000 33. A financial market in which securities that have been Ending Inventory: 20,000 previously issued can be resold. Compute for the Days’ Inventories. Use 360 days. A. Money Market C. Capital Market A. 100 days C. 90 days B. Primary Market D. Secondary Market B. 80 days D. 120 days 34. Which of the following is not a financial institution? 47. Also called as the Net Operating Cycle. A. pension fund C. newspaper publisher A. Cash Conversion Cycle C. A/R Turnover B. savings bank D. credit union B. Inventory Turnover D. Operating Cycle 35. Which of the following is not a service provided by 48. It is the average number of days for the company to pay its financial institutions? creditors. A. Buying the businesses of customers A. Days’ Inventories C. Days’ Receivable B. Investing customer’s savings in stocks and bonds C. Days’ Payable D. Day of Payment C. Paying savers’ interest on deposited funds 49. It is the minimum level of current assets required by a firm D. Lending money to customers to carry on its business operations given its production 36. What is a sales budget? capacity or relevant sales range. A. A plan of items to be sold A. Gross Working Capital C. Permanent Working B. A plan of how much an item will cost Capital C. A plan for how much money should be made in B. Temporary Working Capital D. Net Working a given period of time Capital D. A plan for tracking an inventory and how much 50. A financial market in which securities that have been they sell previously issued can be resold. 37. It calculates the number of units of products that must be A. Money Market C. Capital Market produced B. Primary Market D. Secondary Market A. Budget C. Sales Budget B. Production Budget D. Cash Budget