1) Finance is about managing a) cash inflow b) cash outflow c) employee relation d) supplier management e) workplace safety f) product R&D 2) Choose all answers that describes profit correctly. a) Calculated from the net difference between revenue and expenses b) Recorded using accrual accounting basis c) Recorded using cash basis d) Calculated by deducting liability from the total asset e) Profit is always equal to cash amount f) Reported on the statement of cash flow 3) In order to distribute their income towards various expenditure effectively, one must perform a) budgeting b) proper debt management c) capital raising d) comprehensive risk management 4) Choose all financing decision making a) Investment b) Financing c) Dividend payment 5) What is investment activity? a) The process of allocating financial resources with the expectation of generating long term return b) Allocation of a fraction of a corporation's profit to its stockholders c) The procedural aspects involved in acquiring cash or capital to fulfil diverse financial requirements 6) What is the most effective way to manage the risk in investment? a) To invest all money in different portfolio b) To invest all money in one place c) To not investing at all 7) What are the crucial process to consider in financing decision? a) To decide on the optimal capital structure between the debt and equity financing b) To always pay the dividend to stockholders irrespective of the company's cash position c) To continuously refinance loan to prolong the repayment terms 8) What is the difference between the common and preferred stockholders? a) Preferred stockholders receive a fixed periodic dividend b) Common stockholders' dividend is upon the discretion of the company's BOD decision c) Common stockholders receive a fixed periodic dividend d) Preferred stockholders' dividend is upon the discretion of the company's BOD decision

Chapter 1: Overview of finance

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