WGU D076 FINANCE SKILLS FOR MANAGERS
OBJECTIVE ASSESSMENT Midterm Exam
Questions and Verified Answers Latest
Versions 2025 Top Rated A+
A company calculated variances of a budget and actual cash flows that
indicate the firm's strengths and weaknesses in cash flows and its
budgeting process.
Which major use of cash budgeting is this an example of?
Standardization
Assessment of future needs
Corrective action
Performance evaluation - ✔✔✔ Correct Answer > Performance
evaluation
Why are financial models helpful in financial forecasting?
Models allow users to see the complex relationships between sales and
other aspects of the business.
Models provide credibility to a firm's financial statements for
government agencies to review.
Models show the future supply schedule for a firm, which allows for
negotiation with suppliers. - ✔✔✔ Correct Answer > Models allow
,users to see the complex relationships between sales and other aspects
of the business.
Which process is Li engaging in if he recently made a personal budget
and is now keeping a record of his cash flows?
Forecasting
Tracking
Monitoring
Revising - ✔✔✔ Correct Answer > Tracking
Which tool is forward-looking and thus helps decision makers
understand how actions taken today can affect their firm's future
performance?
Ratio analysis
Financial statements
Financial forecasting - ✔✔✔ Correct Answer > Financial forecasting
Which type of expense is a magazine subscription?
Fixed expense
Monitored expense
Asset expense
Variable expense - ✔✔✔ Correct Answer > Variable expense
, A company is developing a financial forecast for the next year. The
company plans to implement a new factory that will increase
production and resulting sales by 20%.
Since the company's assets are increasing significantly, what else must
increase?
Profit turnover
Accounts receivable turnover
Financing
Gross margin - ✔✔✔ Correct Answer > Financing
Jack works for a company that manufactures televisions and must
obtain financing to increase the company's inventory levels. Jack's
manager knows that current investment markets are tight, and it may
be difficult for the company to obtain additional financing for the next
year. The manager asks Jack to propose a way for the firm to reduce its
discretionary financing needed (DFN).
What should Jack suggest to reduce next year's DFN?
Increase sales growth, resulting in a larger amount of revenue coming
into the firm
Lower the amount of dividends that are paid out to shareholders next
year
Increase the amount spent on fixed assets to increase production
capacity - ✔✔✔ Correct Answer > Lower the amount of dividends
that are paid out to shareholders next year
OBJECTIVE ASSESSMENT Midterm Exam
Questions and Verified Answers Latest
Versions 2025 Top Rated A+
A company calculated variances of a budget and actual cash flows that
indicate the firm's strengths and weaknesses in cash flows and its
budgeting process.
Which major use of cash budgeting is this an example of?
Standardization
Assessment of future needs
Corrective action
Performance evaluation - ✔✔✔ Correct Answer > Performance
evaluation
Why are financial models helpful in financial forecasting?
Models allow users to see the complex relationships between sales and
other aspects of the business.
Models provide credibility to a firm's financial statements for
government agencies to review.
Models show the future supply schedule for a firm, which allows for
negotiation with suppliers. - ✔✔✔ Correct Answer > Models allow
,users to see the complex relationships between sales and other aspects
of the business.
Which process is Li engaging in if he recently made a personal budget
and is now keeping a record of his cash flows?
Forecasting
Tracking
Monitoring
Revising - ✔✔✔ Correct Answer > Tracking
Which tool is forward-looking and thus helps decision makers
understand how actions taken today can affect their firm's future
performance?
Ratio analysis
Financial statements
Financial forecasting - ✔✔✔ Correct Answer > Financial forecasting
Which type of expense is a magazine subscription?
Fixed expense
Monitored expense
Asset expense
Variable expense - ✔✔✔ Correct Answer > Variable expense
, A company is developing a financial forecast for the next year. The
company plans to implement a new factory that will increase
production and resulting sales by 20%.
Since the company's assets are increasing significantly, what else must
increase?
Profit turnover
Accounts receivable turnover
Financing
Gross margin - ✔✔✔ Correct Answer > Financing
Jack works for a company that manufactures televisions and must
obtain financing to increase the company's inventory levels. Jack's
manager knows that current investment markets are tight, and it may
be difficult for the company to obtain additional financing for the next
year. The manager asks Jack to propose a way for the firm to reduce its
discretionary financing needed (DFN).
What should Jack suggest to reduce next year's DFN?
Increase sales growth, resulting in a larger amount of revenue coming
into the firm
Lower the amount of dividends that are paid out to shareholders next
year
Increase the amount spent on fixed assets to increase production
capacity - ✔✔✔ Correct Answer > Lower the amount of dividends
that are paid out to shareholders next year
