Question 1 (2 points)

Which of these is true about the balance statement?

Question 1 options:

a)

All of these

b)

It presents property and equipment as net of accumulated depreciation

c)

It accounts for uncollectable accounts receivable

d)

It lists assets in order of liquidity, from most liquid to least liquid

Question 2 (2 points)

Saved

Agency theory

Question 2 options:

a)

Informs the decision on business structure

b)

Helps determine the best sources of capital

c)

Examines the relationship between owner and management

d)

Guides the capital budgeting process

Question 3 (2 points)

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Which of these is not an activity of financial managers?

Question 3 options:

a)

Recording accounting transactions as they occur

b)

Determining the best balance of capital sources

c)

Balancing the trade-off between profitability and risk

d)

Managing capital budgeting

Question 4 (2 points)

In a publicly traded company, which of the following can do most to help minimize agency issues?

Question 4 options:

a)

Have a very actively involved board of directors

b)

Ensure the CEO and Chairman of the board are two different people

c)

Have the company fully owned by a single person

d)

Reduce oversight of company spending policies

Question 5 (2 points)

A companys net worth equals:

Question 5 options:

a)

The companys total assets

b)

Stockholders equity

c)

Stockholders equity minus preferred stock

d)

Total debt