WGU C201 Business Acumen Chapter 10: Operations
and Quality Management
Frank, chief financial officer for a company, wants to take a look at the summary of
expenses, revenues, and profits of the firm for the most recent quarter. He can best
find this information by consulting the _____. - ANSWERincome statement
The _____ was created by the Sarbanes-Oxley Act of 2002. - ANSWERPublic
Accounting Oversight Board
Which of the following financial statements shows a company's financial position on
a particular date? - ANSWERBalance sheet
Expenses that have been incurred (such as wages) but have yet to be paid are
reported on the balance sheet as _____. - ANSWERaccruals
What are some examples of non-cash expenses? - ANSWERIncome taxes, operating
costs, cost of goods sold
Which of the following current assets is NOT included when calculating the acid-test
ratio? - ANSWERinventory
If a firm has a current ratio of 2.5, it means that for every $2.50 in _____ it has $1.00
in _____. - ANSWERcurrent assets; current liabilities
_____ ratios are designed to evaluate a firm's ability to generate revenues in excess
of operating costs and other expenses. - ANSWERProfitability
All of the following are profitability ratios - ANSWERnet profit margin
gross profit margin
return on equity
What was established in 1973 to promote worldwide consistency in financial
reporting practices? - ANSWERThe International Accounting Standards Committee
(IASC)
Why do we avoid an over-reliance on borrowing? - ANSWERto gain leverage
Households, businesses, government, financial institutions, and financial markets
together form what is known as the - ANSWERfinancial system
What are 3 money market instruments? - ANSWERTreasury bills, commercial paper,
and bank certificates of deposit.
, What are 3 types of bonds? - ANSWERMunicipal bonds, Corporate bonds, mortgage
pass-through security
Types of securities - ANSWERMoney Market Instruments, bonds and stock
Money market instruments are - ANSWERshort-term debt securities issued by
governments, financial institutions, and corporations.
The basic form of corporate ownership is embodied in _____. - ANSWERcommon
stock
Tom just bought a bond from United Pet Group. This bond is only backed by the
financial reputation of the company. What type of bond did Tom buy? -
ANSWERDebenture
An owner of which form of stock would receive dividend payments first? -
ANSWERPreferred stock
The _____ is a collection of financial markets in which previously issued securities
are traded among investors. - ANSWERSecondary market
Which of the following is true about the Fed? - ANSWERThe Fed acts as the banker's
bank.
Virtually, all large commercial banks are Fed members.
The Fed is the nation's central bank.
The chairman of the Federal Reserve Board can accelerate economic activity by
lowering interest rates. What primary method does the Federal Reserve use to
accomplish this? - ANSWERBuying Treasury securities
Which agency regulates both state and federally chartered commercial banks? -
ANSWERThe FDIC
The Securities and Exchange Commission requires virtually all new public issues of
corporate securities to be registered. As part of the registration process for a new
security issue, the issuer must prepare a(n) _____. - ANSWERProspectus
Preferred stockholders receive fixed dividends. - ANSWERTrue
___ are short-term securities issued by the U.S. Treasury and backed by the full faith
and credit of the U.S. government. - ANSWERTreasury Bills
risk-return trade-off - ANSWERprocess of maximizing the wealth of a firm's
shareholders by striking the optimal balance between risk and return.
Finance Managers - ANSWERexecutives who develop and implement the firm's
financial plan and determine the most appropriate sources and uses of funds.
and Quality Management
Frank, chief financial officer for a company, wants to take a look at the summary of
expenses, revenues, and profits of the firm for the most recent quarter. He can best
find this information by consulting the _____. - ANSWERincome statement
The _____ was created by the Sarbanes-Oxley Act of 2002. - ANSWERPublic
Accounting Oversight Board
Which of the following financial statements shows a company's financial position on
a particular date? - ANSWERBalance sheet
Expenses that have been incurred (such as wages) but have yet to be paid are
reported on the balance sheet as _____. - ANSWERaccruals
What are some examples of non-cash expenses? - ANSWERIncome taxes, operating
costs, cost of goods sold
Which of the following current assets is NOT included when calculating the acid-test
ratio? - ANSWERinventory
If a firm has a current ratio of 2.5, it means that for every $2.50 in _____ it has $1.00
in _____. - ANSWERcurrent assets; current liabilities
_____ ratios are designed to evaluate a firm's ability to generate revenues in excess
of operating costs and other expenses. - ANSWERProfitability
All of the following are profitability ratios - ANSWERnet profit margin
gross profit margin
return on equity
What was established in 1973 to promote worldwide consistency in financial
reporting practices? - ANSWERThe International Accounting Standards Committee
(IASC)
Why do we avoid an over-reliance on borrowing? - ANSWERto gain leverage
Households, businesses, government, financial institutions, and financial markets
together form what is known as the - ANSWERfinancial system
What are 3 money market instruments? - ANSWERTreasury bills, commercial paper,
and bank certificates of deposit.
, What are 3 types of bonds? - ANSWERMunicipal bonds, Corporate bonds, mortgage
pass-through security
Types of securities - ANSWERMoney Market Instruments, bonds and stock
Money market instruments are - ANSWERshort-term debt securities issued by
governments, financial institutions, and corporations.
The basic form of corporate ownership is embodied in _____. - ANSWERcommon
stock
Tom just bought a bond from United Pet Group. This bond is only backed by the
financial reputation of the company. What type of bond did Tom buy? -
ANSWERDebenture
An owner of which form of stock would receive dividend payments first? -
ANSWERPreferred stock
The _____ is a collection of financial markets in which previously issued securities
are traded among investors. - ANSWERSecondary market
Which of the following is true about the Fed? - ANSWERThe Fed acts as the banker's
bank.
Virtually, all large commercial banks are Fed members.
The Fed is the nation's central bank.
The chairman of the Federal Reserve Board can accelerate economic activity by
lowering interest rates. What primary method does the Federal Reserve use to
accomplish this? - ANSWERBuying Treasury securities
Which agency regulates both state and federally chartered commercial banks? -
ANSWERThe FDIC
The Securities and Exchange Commission requires virtually all new public issues of
corporate securities to be registered. As part of the registration process for a new
security issue, the issuer must prepare a(n) _____. - ANSWERProspectus
Preferred stockholders receive fixed dividends. - ANSWERTrue
___ are short-term securities issued by the U.S. Treasury and backed by the full faith
and credit of the U.S. government. - ANSWERTreasury Bills
risk-return trade-off - ANSWERprocess of maximizing the wealth of a firm's
shareholders by striking the optimal balance between risk and return.
Finance Managers - ANSWERexecutives who develop and implement the firm's
financial plan and determine the most appropriate sources and uses of funds.
