FiltersDone

Question type

Essay

Multiple Choice

Short Answer

True False

Matching

Exam 19: Recognizing the Basics of Financial Management

Show Answer

Share

---

All types

Filters

Study FlashcardsPractice ExamLearn

Question 31

Multiple Choice

Review LaterAdd Note

Review Later

Rami has a long-standing relationship with his banker. When his company needs a short-term loan, he is able to obtain a loan at prime rate and does not have to put up any collateral for the loan. What type of financing has Rami obtained?

A) unsecured loan
B) secured loan
C) promissory note
D) trade credit

Correct Answer

verified

Show Answer

Question 32

Multiple Choice

Review LaterAdd Note

Review Later

When a company issues an IPO to raise capital, shares of its stock are sold in which of the following markets?

A) institutional
B) primary
C) secondary
D) capital

Correct Answer

verified

Show Answer

Question 33

Multiple Choice

Review LaterAdd Note

With respect to cash flow, a firm ideally should have which of the following?

Tidewater Distributors has an arrangement with its bank in which it has access to a fixed amount of funds to use as needed, and the company has to make monthly payments along with interest based on the outstanding amount of the loan. What type of financing does Tidewater Distributors use?

A disadvantage of which type of financing is that external forces like economic conditions affect the level of interest rates?

In which type of sales arrangement does a seller allow a buyer 30 to 60 days to pay for a purchase?

Lockheed Martin purchased raw materials to produce Black Hawk helicopters. Their payment term is 30 days. Which of the following has Lockheed utilized?

All Star Sporting Goods seeks short-term financing to complete much-needed repairs on its retail store. All Star decides to offer up its inventory as collateral in return for a $20,000 from the bank. Which of the following does this exemplify?

Karissa's lawn care business has become more successful than she had ever imagined, and she finds it necessary to hire an employee who will be responsible for ensuring that the company has sufficient funds to operate, managing those funds effectively, and securing additional funds if and when needed. As such, Karissa's new employee will be responsible for which of the following?

All of the following would be considered proper financial management during both good and bad times EXCEPT which one?

An amusement park operates daily from Victoria Day to Labour Day. In addition, the park is open Fridays, Saturdays, and Sundays throughout May and September. The park finds that the revenue produced from weekend-only operations in May and September is not enough to cover the expenses they incur in those months. Which of the following circumstances requires the amusement park to seek outside financing to cover its short-term cash shortages?

Which of the following does Todd create when he develops a plan for obtaining and using the money necessary for his company to implement its goals?

Which of the following are funds received from the sale of shares of ownership in a business?

Each of the following causes a cash flow problem EXCEPT which one?

Which of the following involves borrowed funds that will be repaid within one year or less?

Jennifer runs a ski store in Banff, Alberta. She buys all her skis for the season in the fall but doesn't receive any money until she sells the skis, which is usually a few months later. The suppliers of the skis will extend the time she needs to pay for the skis to 90 days. What is the term to describe what her suppliers are offering Jennifer?

Kevin received unsecured financing from a bank for his plumbing business. This means that Kevin did NOT have to provide the bank with which of the following?

What does Taye mean when he says that the software company he and his college roommate started is going to "go public"?

Which of the following are funds obtained through loans or the issuance of corporate bonds?

For a corporation such as Bell Canada, what are the two primary advantages of equity financing?