Shared Flashcard Set

Details

Business Finance
true false quizzes
30
Business
Undergraduate 3
09/20/2011

Additional Business Flashcards

 


 

Cards

Term
Inflation is assumed to be a temporary problem that does not affect financial decisions.
Definition
FALSE
Term
There is unlimited liability in a general partnership
Definition
True
Term
Dividends paid to corporate stockholders have already been taxed once as corporate income
Definition
true
Term
Corporate governance issues have become less important to the financial community during the first decade of the new millennium
Definition
FALSE
Term
A major focus of the Sarbanes Oxley Act is to make sure that publicly trades companies accurately present their assets, liabilities and income in their financial statements
Definition
TRUE
Term
Timing is not a particularly important consideration in financial decisions
Definition
FALSE
Term
Money markets refer to those markets dealing with short term securities having a life of one year or less.
Definition
True
Term
The primary market includes the sale of securities by way of initial public offerings
Definition
true
Term
New issues are sold in the secondary market
Definition
false
Term
Higher return always induces stockholders to invest in a company
Definition
false
Term
What is the primary goal of financial management?
Definition
Maximizing shareholder wealth
Term
One of the major advantages of a sole proprietorship is
Definition
Low operating costs
Term
the partnership form of an organization
Definition
Avoids double taxation of earning found in the corporate form of organization
Term
Corporate governance is the
Definition
relationship and exercise of oversight by the board of directors of the company
Term
Agency theory deals with the issue of
Definition
the conflicts that can arise between the viewpoints and motivations of a firm's owners and managers
Term
The sarbanes oxley act was passed in an effort to
Definition
control corrupt corporate behavior
Term
the major difficulty in most insider trading cases has been
Definition
that inside trades have not been legally well defined
Term
When a corporation uses the financial markets to raise new funds, the sale of securities is made in the
Definition
primary market
Term
Companies that have higher risk than a competitor in the same industry will generally have
Definition
to pay higher interest rate, lower relative stock price, and higher cost of funds than its competitors.
Term
The increase in the internationalization of financial markets has led to
Definition
companies searching the global financial markets for low cost funds, an increase in American Depository Receipts on the new york stock exchange, an increase in debt obligations denominated in foreign currency on US corporate balance sheets
Term
the income statement measures the increase in the assets of a firm over a period of time
Definition
false
Term
the P/E ratio provides no indication of investors' expectations about the future of a company
Definition
false
Term
Asset accounts are listed in order of their liquidity
Definition
true
Term
Marketable securities are temporary investments of excess cash and are valued at their original purchase price
Definition
false
Term
Book value per share and market value per share are usually the same dollar amount
Definition
false
Term
Retained earning shown on the balance sheet represents available cash on hand generated from prior year's earning but not paid out in dividends
Definition
false
Term
ash flow consists of illiquid cash equivalents which are difficult to convert to cash within 90 days
Definition
false
Term
An increase in an asset represents a source of funds
Definition
false
Term
Interest expense is deductible before taxes and therefore has an after tax cost equal to the interest paid times ( 1- tax rate)
Definition
Term
A cash flow statement is correct if the net cash flow ties to the ending cash balance
Definition
false
Supporting users have an ad free experience!