All Chapter 1-27 Fully Covered
,Corporate Finance, 12e (Ross) s 4 s 4 s 4
Chapter1IntroductiontoCorporateFinance 4
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1) The treasurer andt he controllerof acorporationgenerallyreportt othe:
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A) boardofdirectors. s4 s4
B) chairman oft he board. s4 s4 s4
C) chiefexecutive officer. s4 s4
D) president.
E) chieffinancialofficer. s4 s4
Answer: E Difficu s 4s 4 s4
lty:1E asy s4 s4
Section: 1.1 What isCorporate Finance? T s 4s 4 s4 s4 s4 s4 s 4
opic: Management organization and r oles
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sBloom's: Remember
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AACSB:
Reflective Thinking A s4 s 4
ccessibility: Keyboard Navigatio s 4 s4
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2) Which oneoft he following statementsc orrectly depictst he common chain ofcommand in a
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s corporation?
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A) The information systemsmanagerreportst ot he treasurer.
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B) The credit manager reportstot he treasurer.
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C) The controllerr eportst ot he c hiefexecutive officer.
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D) The t ax manager reportstot he treasurer.
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E) The c apitalexpenditures manager reportst ot he controller.
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Answer: B Difficu s 4s 4 s4
lty:1E asy s4 s4
Section: 1.1 What isCorporate Finance? T s 4s 4 s4 s4 s4 s4 s 4
opic: Management organization and r oles
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sBloom's: Remember
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AACSB:
Reflective Thinking A s4 s 4
ccessibility: Keyboard Navigatio s 4 s4
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3) Which one oft he following isac apitalb udgeting decision? s4 s4 s4 s4 s4 s4 s4 s4 s4
A) Determining howmuch debt should be borrowed from ap articular lender s4 s4 s4 s4 s4 s4 s4 s4 s4 s4
B) Deciding whether or not anewproductionf acility should b e built s4 s4 s4 s4 s4 s4 s4 s4 s4 s4
C) Deciding when tor epay along-term debt s4 s4 s4 s4 s4 s4
D) Determining howmuchinventory t okeep onhand s4 s4 s4 s4 s4 s4 s4
E) Deciding howmuch creditt ograntt oap articular c ustomer s4 s4 s4 s4 s4 s4 s4 s4 s4
Answer: B s 4s 4
,Difficulty:1Easy s4 s4
Section: 1.1 What isCorporate Finance? T s 4s 4 s4 s4 s4 s4 s 4
opic: Capitalbudgeting s 4s 4 s4
Bloom's: Understand AACSB: s4
Reflective Thinking Accessibi s 4 s 4
lity: Keyboard Navigation
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4) Which oneof these is ac orrect definition? s4 s4 s4 s4 s4 s4 s4
A) Net workingc apitalequalsc urrent assetsp lusc urrentliabilities.
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B) Current liabilities are debtst hat must ber epaid in 18 months or less. s4 s4 s4 s4 s4 s4 s4 s4 s4 s4 s4 s4
C) Current assetsare assets with short lives, such asaccounts receivable. s4 s4 s4 s4 s4 s4 s4 s4 s4 s4
D) Long-term debt isdefined as ar esidual claim on a firm's assets. s4 s4 s4 s4 s4 s4 s4 s4 s4 s4 s4
E) Tangible assetsare fixed assetssuch aspatents. s4 s4 s4 s4 s4 s4 s4
Answer:
C Difficulty: 1 Easy
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Section: 1.1 What is Corporate Finance? s4 s 4 s 4 s 4 s 4 s 4
Topic: Introduction to corporate finance s4 s 4 s 4 s 4 s 4
Bloom's: Remember s 4
AACSB: Reflective
Thinking Accessibility: s 4 s4
sKeyboard Navigation
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5) The corporate controller isgenerallyresponsible for which one oft hese functions?
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A) Capitalexpenditures s4
B) Cash management s4
C) Tax reporting s4
D) Financial planning s4
E) Credit management s4
Answer: C Difficu s 4s 4 s4
lty:1E asy s4 s4
Section: 1.1 What isCorporate Finance? T s 4s 4 s4 s4 s4 s4 s 4
opic: Management organization and r oles
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sBloom's: Remember
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AACSB:
Reflective Thinking A s4 s 4
ccessibility: Keyboard Navigatio s 4 s4
n
6) The corporatetreasurer oversees whichone oft hese areas?
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A) Financial planning s4
B) Cost accounting s4
C) Tax reporting s4
D) Information systems s4
E) Financial accounting s4
Answer: A s 4s 4
, Difficulty:1Easy s4 s4
Section: 1.1 What isCorporate Finance? T s 4s 4 s4 s4 s4 s4 s 4
opic: Management organization andr oles
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sBloom's: Remember
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AACSB:
Reflective Thinking A s4 s 4
ccessibility: Keyboard Navigatio s 4 s4
n
7) Afirm'sc apital structure refers tot he firm's:
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A) mixtureofvarioust ypesofproductionequipment. s4 s4 s4 s4 s4 s4
B) investment selectionsfor itsexcessc ash reserves. s4 s4 s4 s4 s4 s4
C) combination ofc ash and cash equivalents. s4 s4 s4 s4 s4
D) combination of accounts appearing ont he left side ofitsb alance sheet. s4 s4 s4 s4 s4 s4 s4 s4 s4 s4 s4
E) proportionsoffinancing fromc urrent and long-term debt and equity. s4 s4 s4 s4 s4 s4 s4 s4 s4
Answer: E Difficu s 4s 4 s4
lty:1E asy s4 s4
Section: 1.1 What isCorporate Finance? T s 4s 4 s4 s4 s4 s4 s 4
opic: Capital structure s 4s 4 s4
Bloom's: Remember AACSB: s 4
Reflective Thinking Accessibi s 4 s 4
lity: Keyboard Navigation
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8) Short-term finance deals with: s4 s4 s4
A) thet iming of cash flows. s4 s4 s4 s4
B) acquiring and selling fixed assets. s4 s4 s4 s4
C) financing long-termprojects. s4 s4
D) capitalb udgeting. s4
E) issuing additionalsharesofc ommon stock. s4 s4 s4 s4 s4
Answer: A Difficu s 4s 4 s4
lty:1E asy s4 s4
Section: 1.1 What isCorporate Finance? s 4s 4 s4 s4 s4 s4
s Topic: Cash management -
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general Bloom's:
s4 Understand s 4
AACSB:
Reflective Thinking A s4 s 4
ccessibility: Keyboard Navigatio s 4 s4
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