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SPMA 2P27 Final Review updated with complete solutions
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SPMA 2P27 Final Review updated with complete solutions
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SPMA 2P27 Final ReviewWhat is the definition of finance? - correct answer ✔✔Besides paying the bills, making and managing
money provide the framework for future growth. Finding, managing, tracking, and spending money refer
to specific finance-related functions within a company or a business.
What does finance boil down to? - correct answer ✔✔The management and growth of money.
What is accounting and what does it boil down to? - correct answer ✔✔Financial accounting is the
recording and communication of economic information in accordance with Generally Accepted Principles
(GAAP). It boils down to tracking and analyzing what's already been spent.
What are the 4 financial statements we looked at in class? - correct answer ✔✔1. Income Statement
2. Statement of Financial Position/Balance Sheet
3. Cash flow statement
4. Profit and Loss Statement
.What is financial planning and Michael Porter's quote? - correct answer ✔✔Financial Planning -
examining future income and expenses to help steer a company in a given direction.
Porter said "the essence of strategy is choosing what not to do."
What are the 5 forces in Porter's 5 forces analysis? - correct answer ✔✔1. Threat of New Entrees
2. Threat of a Substitute Products or Services
3. Rivalry among existing competitors
4. Bargaining Power of Buyer
5. Bargaining Power of Supplier
What is the formula for Profit? - correct answer ✔✔Profit = Revenue - Expenses
, Finance is the "_______ of the management of money and other assets" - correct answer ✔✔science
What 2 things does financial management ensure? - correct answer ✔✔Proper and efficient
management.
Why use financial reporting and accounting? - correct answer ✔✔It is used to provide the most useful
financial information for decision-making (strategy).
What is the difference of managerial accounting as a opposed to financial accounting? - correct answer
✔✔Managerial is about "internal" accounting, flexible information used to helped run the company.
Where as financial accounting is "outside" accounting and it most facts that are used for reporting.
What is the Accounting Equation? - correct answer ✔✔Assets = Liabilities + Stockholders' Equity
What is a capital asset? - correct answer ✔✔Significant pieces of property.
What is a business capital asset? - correct answer ✔✔Tangible asset with a useful life, typically longer
than a year, not intended for sale in the regular course of the business's operation.
What is an intangible asset? - correct answer ✔✔An asset that is not physical in nature.
What is the difference between Gross and Net revenue? - correct answer ✔✔Gross - total amount
BEFORE expenses
Net - total amount AFTER expenses
What does EBITDA stand for? - correct answer ✔✔Earnings
Before
Interest
Taxes
Depreciation
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