CORPORATE FINANCE, 12TH EDITION ROSS TEST BANK |NEW 2026

CORPORATE FINANCE, 12TH EDITION ROSS TEST BANK |NEW
2026



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,Corporate Finance, 12e (Ross)x x x


Chapter 1 Introduction to Corporate Finance
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1) The treasurer and the controller of a corporation generally report to the:
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A) board of directors.
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B) chairman of the board. x x x


C) chief executive officer.
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D) president.
E) chief financial officer.
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Answer: E x


Difficulty: 1 Easy
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Section: 1.1 What is Corporate Finance?
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Topic: Management organization and
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roles Bloom's:
x x Remember
AACSB: Reflective Thinking x


Accessibility: Keyboard
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Navigation
x




2) Which one of the following statements correctly depicts the common chain of command in a
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corporation?
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A) The information systems manager reports to the treasurer.
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B) The credit manager reports to the treasurer.
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C) The controller reports to the chief executive officer.
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D) The tax manager reports to the treasurer.
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E) The capital expenditures manager reports to the controller.
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Answer: B x


Difficulty: 1 Easy
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Section: 1.1 What is Corporate Finance?
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Topic: Management organization and
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roles Bloom's:
x x Remember
AACSB: Reflective Thinking x


Accessibility: Keyboard
x x


Navigation
x




1
Copyright © 2019 McGraw-Hill Education. All rights reserved. x x x x x x x

No reproduction or distribution without the prior written consent of McGraw-Hill Education.
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,3) Which one of the following is a capital budgeting decision?
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A) Determining how much debt should be borrowed from a particular lender
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B) Deciding whether or not a new production facility should be built
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C) Deciding when to repay a long-term debt
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D) Determining how much inventory to keep on hand x x x x x x x


E) Deciding how much credit to grant to a particular customer
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Answer: B x


Difficulty: 1 Easy
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Section: 1.1 What is Corporate Finance?
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Topic: Capital budgeting
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Bloom's: Understand
AACSB: Reflective Thinking
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Accessibility: Keyboard Navigation x x x




4) Which one of these is a correct definition?
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A) Net working capital equals current assets plus current liabilities.
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B) Current liabilities are debts that must be repaid in 18 months or less.
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C) Current assets are assets with short lives, such as accounts receivable.
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D) Long-term debt is defined as a residual claim on a firm's assets.
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E) Tangible assets are fixed assets such as patents.
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Answer: C x


Difficulty:
x 1 x


Easy
x


Section: 1.1 What is Corporate Finance?
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Topic: Introduction to corporate finance
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Bloom's: Remember
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AACSB: Reflective Thinking x x


Accessibility:
x Keyboard x x


Navigation
x




5) The corporate controller is generally responsible for which one of these functions?
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A) Capital expenditures x


B) Cash management
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C) Tax reporting
x


D) Financial planning x


E) Credit management x




Answer: C x


Difficulty: 1 Easy
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Section: 1.1 What is Corporate Finance?
x x x x x


Topic: Management organization and
x x x x


roles Bloom's:
x x Remember
AACSB: Reflective Thinking x


Accessibility: Keyboard
x x


Navigation
x


2
Copyright © 2019 McGraw-Hill Education. All rights reserved. x x x x x x x

No reproduction or distribution without the prior written consent of McGraw-Hill Education.
x x x x x x x x x x x

, 6) The corporate treasurer oversees which one of these areas?
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A) Financial planning x


B) Cost accounting x


C) Tax reportingx


D) Information systems x


E) Financial accounting x




Answer: A x


Difficulty: 1 Easy
x x x


Section: 1.1 What is Corporate Finance?
x x x x x


Topic: Management organization and
x x x x


roles Bloom's:
x x Remember
AACSB: Reflective Thinking x


Accessibility: Keyboard
x x


Navigation
x




7) A firm's capital structure refers to the firm's:
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A) mixture of various types of production equipment.
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B) investment selections for its excess cash reserves.
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C) combination of cash and cash equivalents. x x x x x


D) combination of accounts appearing on the left side of its balance sheet.
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E) proportions of financing from current and long-term debt and equity.
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Answer: E x


Difficulty: 1 Easy
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Section: 1.1 What is Corporate Finance?
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Topic: Capital structure
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Bloom's: Remember
xAACSB: Reflective Thinking x x


Accessibility: Keyboard Navigation x x x




8) Short-term finance deals with: x x x


A) the timing of cash flows.
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B) acquiring and selling fixed assets.
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C) financing long-term projects. x x


D) capital budgeting. x


E) issuing additional shares of common stock.
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Answer: A x


Difficulty: 1 Easy
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Section: 1.1 What is Corporate
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Finance? Topic: Cash management -
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general Bloom's: Understand
x x


AACSB: Reflective Thinking x


Accessibility: Keyboard
x x


Navigation
x




3
Copyright © 2019 McGraw-Hill Education. All rights reserved. x x x x x x x

No reproduction or distribution without the prior written consent of McGraw-Hill Education.
x x x x x x x x x x x