Buss 1 – Planning and Financing a Business – Exam 1 || With Questions & Answers (Graded A+)
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Course
Business finance
Institution
Business Finance
Buss 1 – Planning and Financing a Business – Exam 1 || With Questions & Answers (Graded A+)
Buss 1 – Planning and Financing a Business – Exam 1 || With Questions & Answers (Graded A+)
Finance is the function of acquiring and management of ______. - ANSWER - funds
Is it more common fo...
, Buss 1 – Planning and Financing a
Business – Exam 1 || With Questions &
Answers (Graded A+)
Finance is the function of acquiring and management of ______. - ANSWER - funds
Is it more common for a firm to fail due to lack of sales or poor financial
management? - ANSWER - poor financial management
The three steps in the financial planning process are to forecast the firm's short- and
long-term needs, develop budgets, and ______. - ANSWER - establish financial
controls
Short-term forecasts generally cover up to a ______. - ANSWER - year
When a company allocates the use of specific resources throughout the firm based
on a financial plan indicating management's expectations, then the company is using
a(n) as the basis for making decisions. - ANSWER - Blank 1: budget
In any business, funds come into and go out of a business. What business function
acquires funds for the firm and then manages those funds on a day-to-day basis? -
ANSWER - finance
When a firm periodically compares its actual revenues, costs, and expenses with its
budget, it is engaging in control. - ANSWER - Blank 1: financial
What are the three most common reasons firms fail financially? - ANSWER -
undercapitalization
inadequate expense control
poor control over cash flow
Needs for operating funds include ______. (Select all that apply) - ANSWER -
making capital expenditures
acquiring needed inventory
controlling credit operations
Select the steps in financial planning. (Select all that apply) - ANSWER - develop
budgets
establish financial controls
forecasting short term needs
A(n) ______ forecast predicts revenues, costs, and expenses for a period of one
year or less. - ANSWER - short-term
The value of money is the idea that money in your possession today is worth more
than money that will be in your possession in the future. - ANSWER - Blank 1: time
, A(n) is a financial plan that sets forth management's expectations and, on the basis
of those expectations, allocates the use of specific resources throughout the system.
- ANSWER - Blank 1: budget
Accepting credit cards can be useful to small businesses by - ANSWER -
In financial planning, what is the process in which a firm periodically compares its
actual revenues, costs, and expenses, with its budget? - ANSWER - Credit cards
provide a readily available line of credit that can save time. Credit cards are
extremely costly and risky. Interest rates are high.
What inventory management procedure helps a firm to control inventory costs? -
ANSWER - implementing a just-in-time inventory control method
Funding day-to-day operations, acquiring needed inventory, and making capital
expenditures are all needs for funds in an organization. - ANSWER - Blank 1:
operating, operational, or operation
Major investments in either tangible long-term assets such as land, or intangible
assets such as patents are considered to be ______ expenditures. - ANSWER -
capital
Place the three steps in the financial planning process in order from beginning to end
with the first step at the top.
Instructions - ANSWER - 1. Forecasting the firm's financial needs
2. developing budgets
3. establishing financial controls
Money is considered to have a time value because ______. - ANSWER - money has
more value in your possession today than at a later point in the future
A firm raising funds through various forms of borrowing with the intent to pay it back
is using financing. - ANSWER - Blank 1: debt
During tough economic times, customers are happy when firms extend for
purchases. - ANSWER - Blank 1: credit
Careful control of a firm's costs allows it to maintain correct levels of stock and
product. - ANSWER - Blank 1: inventory
A firm that makes a major investment in a long-term asset has made a(n)
expenditure. - ANSWER - Blank 1: capital
Short-term financing is more important to a small business than long-term financing
because ______. - ANSWER - small businesses are more concerned with funding
day to day operations
The three steps in the financial planning process are to forecast the firm's short- and
long-term needs, develop budgets, and ______. .. - ANSWER - establish financial
controls
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