C214 OA FINANCIAL MANAGEMENT
CERTIFICATION EVALUATION 2026
QUESTIONS WITH SOLUTIONS GRADED A+
⩥ Difference Subject Areas in Finance.
Answer: Investment (Savers)
Corporate Finance (Borrowers)
Financial Markets & Institutions (Intermediaries)
⩥ 3 main forms of business organizations with bonus.
Answer: There are three main forms of business organizations:
1. Sole Proprietorship
2. Partnership
3. Corporations
Limited liability Companies (LLC) is hybrid between partnership and
corporation.
⩥ Proprietorship and Partnership Adv and Dis.
Answer: Advantages:
Easy to form
Few regulations
,Lower tax
Disadvantages:
Unlimited liability
Limited life
Difficult to raise capital
⩥ Corporation Adv. and Disadvantage.
Answer: Advantages:
1. Limited liability
2. Unlimited life
3. Easy to raise capital
Disadvantages:
1. Hard to form
2. More regulations
3. High tax
4. Agency problem
⩥ Finance within a corporation.
Answer:
⩥ What is management's primary goal?.
, Answer: Maximize the wealth of stakeholders in a socially responsible
way so that the wealth is maximized long term
⩥ Getting Capital.
Answer: IPO with underwriter and issuing secondary stock
⩥ difference in 3 financial statements.
Answer: Income statement - summarizes a firm's revenues and expenses
over a given period of time.
Balance sheet - provides a snapshot of a firm's financial position at one
point in time.
Statement of cash flows - reports the impact of a firm's activities on cash
flows over a given period of time.
⩥ Difference between sales and expenses.
Answer: Profit
⩥ What kind of income statements.
Answer: Income Statement: usually you will find annual and quarterly
income statement for a public firm (Profit and Loss Statement)
⩥ What does accounting provide us with.
Answer: historical health of company
CERTIFICATION EVALUATION 2026
QUESTIONS WITH SOLUTIONS GRADED A+
⩥ Difference Subject Areas in Finance.
Answer: Investment (Savers)
Corporate Finance (Borrowers)
Financial Markets & Institutions (Intermediaries)
⩥ 3 main forms of business organizations with bonus.
Answer: There are three main forms of business organizations:
1. Sole Proprietorship
2. Partnership
3. Corporations
Limited liability Companies (LLC) is hybrid between partnership and
corporation.
⩥ Proprietorship and Partnership Adv and Dis.
Answer: Advantages:
Easy to form
Few regulations
,Lower tax
Disadvantages:
Unlimited liability
Limited life
Difficult to raise capital
⩥ Corporation Adv. and Disadvantage.
Answer: Advantages:
1. Limited liability
2. Unlimited life
3. Easy to raise capital
Disadvantages:
1. Hard to form
2. More regulations
3. High tax
4. Agency problem
⩥ Finance within a corporation.
Answer:
⩥ What is management's primary goal?.
, Answer: Maximize the wealth of stakeholders in a socially responsible
way so that the wealth is maximized long term
⩥ Getting Capital.
Answer: IPO with underwriter and issuing secondary stock
⩥ difference in 3 financial statements.
Answer: Income statement - summarizes a firm's revenues and expenses
over a given period of time.
Balance sheet - provides a snapshot of a firm's financial position at one
point in time.
Statement of cash flows - reports the impact of a firm's activities on cash
flows over a given period of time.
⩥ Difference between sales and expenses.
Answer: Profit
⩥ What kind of income statements.
Answer: Income Statement: usually you will find annual and quarterly
income statement for a public firm (Profit and Loss Statement)
⩥ What does accounting provide us with.
Answer: historical health of company
