1.Even though a new company may be recognized as strong and very likely to make a profit, success is not guaranteed. The new company may seek financial help from a special type of organization that is interested in becoming invested in the new company. What is the primary question the investment organization hopes to answer before investing in the new company?

A. Does the new company rely more heavily on CI than CPI, and what are the implications of doing so?

B. What is preventing the new company from charging higher prices?

C. What is the likelihood our investment will return value to us that is equal to and greater than our original investment?

D. To what extent will the new company's operations be based on global trade, and how will importing operations compare to exporting operations?

2.Which of the following trades securities that are not on registered stock exchanges?

A. London Stock Exchange. B. NYSE. C. Chicago Board of Trade. D. Over-the-counter market.

3.A recap of all of the financial data in the ledgers that helps make certain entries are correct. This is best described as? A. Financial statements. B. Financial control. C. Trial balance. D. Balance sheet.

4.More companies use _____ than any other way of acquiring funds, in order to finance the operations of their businesses. A. Equity financing. B. Trade credit. C. Unsecured loans. D. Secured loans.

5.Before a bank provides credit to a company to help that company finance its operations, which of the following is not something the bank will likely consider: A. How the company applies the bank's compliance-based ethics code. B. The health (good or bad) of the economy. C. If the company has collateral to offer. D. The type of industry in which the company operates.

6.When companies owe money to creditors, suppliers, and others, these outstanding amounts are recorded on the balance sheet as _____. A. Liabilities. B. Expenses. C. Contra-assets. D. Owners' equity.

7.Sometimes a company may not be able to operate its business just from the money it earned from selling its good and services. Therefore, it is not unusual for a company to get money in another manner, in order to operate its business. The act of getting the money in this other manner is called _____ if the company is not required to pay for the money its obtained (choose the answer that best describes this situation). A. Unsecured loan financing. B. Secured loan financing. C. Equity financing. D. Trade crediting.

8.Corporations are not allowed to give loans to its directors and executives. This law is from (choose the best answer): A. The Sarbanes-Oxley Act. B. The Federal Reserve. C. Tax accounting. D. The FASB.

9.If a company owns a copyright, the accounting department will categorize it as what type of asset? (choose the answer that best describes the situation) A. Current asset. B. Fixed asset. C. Intangible asset. D. Short-term asset.

10.The fundamental accounting equation is, "Assets = Liabilities + Owners Equity." How can you change the equation, so "Owners' Equity" is by itself on one side of the equal sign?

A. Liabilities divided by Assets = Owners' Equity. B. Liabilities - Assets = Owners' Equity. C. Assets - Liabilities = Owners' Equity. D. The fundamental accounting equation cannot be changed.