TRUE/FALSE QUESTIONS [10 MARKS] Answer ALL questions. Each question carries ONE (1) mark. State whether each of the following statements is TRUE or FALSE.

1. The main aim of the firm is to maximise shareholders wealth.

2. Bonds and stocks are the major capital market securities.

3. An aggressive funding strategy helps the business to meet its seasonal funding requirements using long term financing option to meet its seasonal and permanent requirements of funds.

4. Budgeting helps in establishing the responsibilities at different levels.

5. A budget is a collation of forecasts and plans expressed in financial terms.

6. The highest price offered by a dealer to purchase a given security is referred to as the ask price, and the lowest price at which the dealer is willing to sell the security is referred to as the bid price.

7. A corporation has limited liability.

8. Liquidity ratios measure the companys ability to meet short term obligations.

9. The investing flows are directly related to sale and production of the products and services.

10. The major input for preparing pro forma statements is the sales forecast.