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FINANCIAL MANAGEMENT > Midterm > Flashcards

Midterm Flashcards

1
Q

Stages of Exchange Development

A

1st stage - Direct Appropriation stage
2nd stage- Direct/Barter
3rd stage - the use of Commodity as Money
4th stage - credit money

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2
Q

What early man’s need was provided by its natural resources

A

1st stage - Direct Appropriation stage

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3
Q

Exchange of Goods and services directly exchange for other goods and services

A

2nd stage- Barter/direct

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4
Q

Some goods, because of its usefulness, beauty, scarcity, and rarity commands a wide acceptance as medium of exchange

A

3rd stage- the use of commodity as money

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5
Q

Money whose monetary value is more than its material or commodity value

A

4th stage - credit money

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6
Q

Money comes from what word?

A

Greek

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7
Q

Greek word of Money

A

moneta

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8
Q

anything which is used as a medium of exchange and is widely accepted as payment

A

money

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9
Q

a mandatory law that.make money acveptec as payment

A

Legal Tender power

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10
Q

it give money its Purchasing Power

A

Legal Tender Power

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11
Q

Functions of Money

A

as a medium of exchange
As a standard unit of value
As a standard of deferred payment
As a store of value

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12
Q

money serves as a common medium or tool of exchange

A

As a medium of exchange

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13
Q

money serves as a mesuring device in which value of goods and services can be expressed

A

as a standard unit of value

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14
Q

money can be use to pay for debts and obligations

A

as a standard of deferred payments

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15
Q

Money has the quality to be kept or stored for future use

A

As a store of value

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16
Q

characteristics of money

A

general acceptance
Stability
Durability
Portability
Malleability
Divisibility
Uniformity
Homogeneity
Cognizability

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17
Q

Accepted by anyone kn exchange for goods and services

A

general acceptance

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18
Q

Value must not change every now and then

A

stability

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19
Q

money is made ligjt, to be easily carried

A

Portability

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20
Q

Design should not only aesthetically beautiful but also difficult to counterfeit

A

cognizability

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21
Q

money must withstand longer period of time agains wear and tear

A

Durability

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22
Q

Divisible into small parts and likewise posaible to recombine these small parts into bigger denominations

A

Divisibility

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23
Q

money can be melted and beaten inti desired shape to conform to the specification of the government

A

Malleability

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24
Q

Money must conform to certain standard to avoid confusion (siz, shape, and color)

A

uniformity

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25
Q

material used must be uniform in composition throughout

A

homogeneity

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26
Q

Forms of money

A

Commodity Money
Currency (bills and coins)
Check

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27
Q

money that is made up of precious metal or another value such as non metallic money and metallic money or gold/silver

A

Commodity money

28
Q

domestic currency can only be used in its country of origin

A

currency

29
Q

generally used in business and persons in conducting business, as well.as personal transaction

A

Check

30
Q

relate to decisions concerning stocks and bonds and inclue a number of activities such as security analysis, portfolio theory, market analysis

A

investments

31
Q

Is a system that includes the circulation of money, the granting of credit, the making of investments and the provision of banking facilities

A

Finance

32
Q

Also called as corporate finance. Focuses on decision relatinh to how much and what types of assets to buu

A

financial.management

33
Q

relate to the markets where interest rates, along with stock anr bond prices are determined

A

capital markets

34
Q

A business owned by one individual

A

sole proprietorship

35
Q

A business owned by two or more.person

A

partnership

36
Q

A legal entity created by a stage, separate and distinc from its owner and managers

A

Corportation

37
Q

Advantage of sole proprietorship and parnership (familiarized)

A

Ease of formation

Subject to few regulation

No corporate income taxes

38
Q

Disadvantage of sole proprietorship and parnership (familiarized)

A

difficult to raise capital

Unlimited liability

Limited life

39
Q

Advantage of Corporation (familiarized)

A

unlimited life

Easy to tranfer ownership

Limited liability

Ease to raise capital

40
Q

Disadvantage of Corporation (familiarized)

A

Double taxation

Cost to setup and report filing

41
Q

Means planning, organizing, directing, and controlling the financial activities

A

Financial Management

42
Q

Applying general management principles to financial resources of th enterprise

A

financial management

43
Q

It may be defined as the area or function in an organization which is concerned with profitability, etc

A

Financial management

44
Q

Generally cincered with short term working capital management

A

Financial management

45
Q

objective of Financal management

A

generally concerned with procurement, allocation, and control of financial resources

46
Q

function of financal management

A

estimation of capital requirements
Determination of capital composition
Choice of sources of funds
Investment of funds
Disposal of surplus
Management of cash
Financial control

47
Q

a finance manager has to make estimation with regards to capital requirements of the company. This will depend upon expected cost and profits

A

estimation of capital requirements

48
Q

the capital structure have to be decider. This involves short term and long term dept equilty analysis

A

Determination of capital composition

49
Q

a company has manu choices like issue of shares and debentures, loans to be taken from banks and financial institution, public deposits to be drawn like in form of bonds

A

choice of sources of funds

50
Q

The finance manager has to decide to allocate funds into profitable ventures

A

investement of funds

51
Q

the net profits decision have to be made by financial management

A

Disposal of surplus

52
Q

type of disposal that includes indentifying thr rate of dividends and other benefits like bonus

A

dividend declaration

53
Q

Tyoe of disposal that the volume has to be decided which will depend upon expansional, innovational, diversification plans of the company

A

retailed profits

54
Q

Finance manager has to make decision in regard to cash management

A

management of cash

55
Q

It is required for many purposes like payment of waged and salaries, etcs

A

cash

56
Q

The finance manager has not only to plan, procure, and utilize the funds but he also has to exercuse control over finance

A

financial control

57
Q

Perform data analysis and advise senior managers on profit maximizing ideas

A

Financial managers

58
Q

The produce financial reports, direct investments activities and develop strategies and plans

A

financial manager

59
Q

task of financial manager

A

raising funds
Allocation of funds
Profit planning
Understanding capital market

60
Q

In order to meet the obligation of the business it is important to have enough cash and liquidity.

It is the responsibility of finance manager to decide the ratio between depts and equity

A

Raising of funds

61
Q

the funds should allocate in such manner that they are optically use

A

Allocation of funds

62
Q

is one of the prime function of any business organization

A

Profit planning

63
Q

It is important of survival and sustenance of any organization

A

profit earning

64
Q

it arises due tomany factors such as pricing, etc

A

Profit

65
Q

It is incurred by the use of fixed factors of production such as land and machinery

A

fixed cost

66
Q

It must be calculated in order to replaced those factors of production which us gone thrown wear abd tear

A

Opportunity cost

67
Q

A clear understanding of capital market is impirtant function of a financial manager

A

Understanding capital market

FINANCIAL MANAGEMENT (2 decks)

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