Business 001 - Introduction to Business » Spring 2022 » Ch 16 OpenStax Homework
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Question #1
Making sure that enough cash is on hand to pay bills as they come due and to meet unexpected expenses is called cash:
A.
capitalization
B.
administration
C.
maintenance
D.
management
E.
targeting
Question #2
Chez Dove is an independent coffeehouse/bookstore that went bankrupt only eight months after opening due to an unexpected demand for cash to fix a leaking roof. Better cash _____ might have allowed the business to continue operation.
A.
management
B.
targeting
C.
maintenance
D.
administration
E.
capitalization
Question #3
Financial managers often shift temporary funds from checking accounts to _____ securities to earn higher interest returns.
A.
strategic
B.
administrative
C.
commercial
D.
marketable
E.
operational
Question #4
Short-term investments that are easily converted back to cash and are used by financial managers to achieve higher returns than those offered by checking accounts are:
A.
marketable credits
B.
negotiable securities
C.
corporate securities
D.
corporate equities
E.
management vehicles
Question #5
_____ is a short-term unsecured debt issued by a financially strong corporation.
A.
A treasury bill
B.
A money market deposit
C.
Investment credit
D.
Commercial paper
E.
A certificate of deposit
Question #6
Commercial paper is:
A.
a type of IOU
B.
the same thing as accounts receivable recorded in the ledger
C.
typically issued by stakeholders
D.
a type of secured debt
E.
accurately described by none of the above
Question #7
The three most popular types of marketable securities are Treasury bills, certificates of deposit, and:
A.
corporate bonds
B.
checking accounts
C.
money market funds
D.
Treasury notes
E.
commercial paper
Question #8
Grainger Distribution Company sold Long Electronics ten circuit breakers for $179.00 each. Long Electronics will be allowed thirty days to pay the bill. Grainger will carry the $1790.00 on its books as a(n):
A.
fixed liability
B.
account receivable
C.
account payable
D.
current liability
E.
marketable security
Question #9
_____ are specific repayment conditions as to how long customers have to pay bills and the amount of cash discount allowed.
A.
Revolving accounts
B.
Liability procedures
C.
Credit terms
D.
Sales terms
E.
Credit credentials
Question #10
The cost of inventory to the firm includes all of the following EXCEPT:
A.
insurance costs
B.
handling costs
C.
purchase price
D.
selling costs
E.
ordering costs
Question #11
Funds invested in long-lived assets, such as land, buildings, machinery, and equipment, are called:
A.
material costs
B.
capital expenditures
C.
operating expenses
D.
production costs
E.
manufacturing expenses
Question #12
As the Toronto-based Four Seasons hotel chain remodels an existing hotel in Mumbai to bring it to the five-star hotel’s exacting standards, it is building a magnificent revolving restaurant overlooking the Arabian Sea at World. The restaurant structure is an example of a(n):
A.
account receivable
B.
intangible asset
C.
capital expenditure
D.
material cost
E.
operating cost
Question #13
Which of the following would be an example of a capital expenditure for a superstore that specializes in outdoor grills and other items needed for outside dining?
A.
a handheld calculator
B.
pens and markers
C.
order forms
D.
a parking lot
E.
cardboard sale signs
Question #14
_____ is the process of selecting the capital expenditures that offer the best returns and meet the goal of maximizing the firm's value.
A.
Budget analysis
B.
Capital allocation
C.
Capital evaluation
D.
Budget allocation
E.
Capital budgeting
Question #15
Capital budgeting:
A.
analyzes production costs
B.
allows managers to analyze profit and loss statements
C.
combines all budgets into a master budget
D.
selects asset proposals for maximum profitability
E.
helps select new products
Question #16
Short-term loans:
A.
are always secured
B.
do not require any collateral
C.
are shown as a current liability on the balance sheet
D.
have a maturity of one year or longer
E.
are shown as a capital expenditure on the balance sheet
Question #17
The three main types of unsecured short-term loans are:
A.
trade credit, accounts payable, and bank loans
B.
treasury bills, certificates of deposit, and accounts payable
C.
trade credit, bank loans, and commercial paper
D.
commercial paper, accounts payable, and trade credit
E.
accounts payable, notes payable, and loans payable
Question #18
When Magna Manufacturing sells hand on screwdriver sets to Malloy Building Supply Company, Magna bills the tool manufacturer for the screwdriver purchase with terms of payment, which specify when the account is due. This type of unsecured loan is called _____ credit.
A.
trade
B.
borrower's
C.
product
D.
revolving
E.
factored
Question #19
A(n) _____ is a type of loan often used to finance buildup of inventory for seasonal (cyclical) businesses just before their strongest sales period.
A.
unsecured bank loan
B.
collateral loan
C.
trade credit
D.
secured bank loan
E.
commercial paper loan
Question #20
Which of the following businesses would be most likely to require an unsecured bank loan, such as a line of credit or a revolving credit agreement?
A.
a Christmas tree farm
B.
a manufacturer of health and beauty aids
C.
a manufacturer of integrated circuits
D.
an envelope manufacturer
E.
a poultry producer
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