Multiple Choice

Question 1

Signifies the firm’s capacity to meet its current financial obligations using its current assets

Answer 1

Current ratio

Question 2

Signifies the firm’s capacity to meet its financial obligation using its quick assets

Answer 2

Current ratio

Question 3

Ratio that gauge liquidity

Answer 3

Current ratio

Question 4

Ratio used to gauge firms efficiency in the use of its assets

Answer 4

Average collection period

Question 5

Ratio used to gauge efficiency in the use of its debts

Answer 5

Equity to debt ratio

Question 6

Are relationships determined from a company’s financial information and used for comparison purposes

Answer 6

Financial ratios

Question 7

Is a quantitative method of gaining insight into a company’s liquidity, operational efficiency, and profitability by studying its financial statements such as balance sheet and income statement

Answer 7

Financial ratio analysis

Question 8

Classification of ratios used to gauge the capacity of the firm to meet its current financial obligations

Answer 8

Liquidity ratios

Question 9

Classification of ratios used to gouge the capacity of the firm to generate returns from the use of its resources

Answer 9

Profitability

Question 10

Documents used in computing financial ratios

Answer 10

Financial statements

Question 11

A formal systematic managerial process that is organized by responsibilities time and information to assure that all other types of planning acre carried out regularly to enable top management to direct and control the future of the firm

Answer 11

Corporate planning

Question 12

Creation of strategies that are aimed at maximizing the firm’s future position taking into consideration that various elements and factors that may be provide the firm’s internal and external environment

Answer 12

Strategic planning

Question 13

Also called capital expenditures planning

Answer 13

Project planning

Question 14

Concerned on how to efficiently and effectively utilize the firm’s resources to achieve the company’s short-term and long-term objectives already set up

Answer 14

Operational planning

Question 15

Involves quantifying the plans in terms of monetary value

Answer 15

Budgeting

Question 16

Under this method of forecasting sales each salesman estimates the sales in his particular territory

Answer 16

Sales force ….

Question 17

Under this method of forecasting sales the view of a number of top executives are culled to arrive at the sales estimate

Answer 17

executive Opinion

Question 18

Under this method of forecasting sales the combination of various methods of forecasting is used

Answer 18

Multiple approach

Question 19

Is a budget which may be done on a monthly or quarter basis out of the budget for the year

Answer 19

Rolling budget

Question 20

Objective of budgeting which provides a yardstick against which the firm can measure and compare the budgeted amount and actual results of operations

Answer 20

Control

Question 21

A formal, systematic managerial process that is organized by responsibilities, time and information to ensure that all planning types can be carried out

Answer 21

Corporate planning

Question 22

Creation of strategies that are aimed at maximizing the firm’s future position into during the elements and practice in the firm’s internal and external environment

Answer 22

Strategic planning

Question 23

Also called capital expenditures planning

Answer 23

Project planning

Question 24

Concerned with how to efficiently and effectively utilize the firm’s resources to achieve the firm’s objectives

Answer 24

Operational planning

Question 25

Involves quantifying the plants in terms of monetary value

Answer 25

Budgeting

Question 26

Under this method in the product life cycle is used in making the sales forecast

Answer 26

Sales trend analysis

Question 27

Under this method is salesman estimates the sales in his particular territory

Answer 27

Sales force composite method

Question 28

A more scientific means of forecasting sales

Answer 28

Correlational analysis method

Question 29

Relationship between expected sales of the company in terms of market share

Answer 29

Industry trend analysis method

Question 30

The view of a number of top managers are culled to arrive at a sales estimate

Answer 30

Executive opinion method

Question 31

Represents the remaining cash collection of the day waiting to be deposited the next banking day

Answer 31

Cash on hand

Question 32

Represents cash already deposited in the bank

Answer 32

Cash in bank

Question 33

An account where the money deposited will earn interest income for the meantime while it is not yet used

Answer 33

Saving account

Question 34

Sometimes called demand deposit

Answer 34

Current account

Question 35

Savings and current accounts in one bank account

Answer 35

Combo account

Question 36

The fund that has to be maintained under the imprest system of handling cash

Answer 36

Cash fund

Question 37

Short-term and highly liquid investments readily convertible to cash

Answer 37

Cash equivalent

Question 38

Risk built in every organization

Answer 38

Inherent risk

Question 39

Risk associated with the use of technology

Answer 39

Systems risk

Question 40

Receipt used by collectors

Answer 40

Provisional receipt

Question 41

Receipt used by the cashier upon receipt of cash

Answer 41

Official receipt

Question 42

Summary of collection made by the collector for the day

Answer 42

Daily collector’s remittance form

Question 43

Disappointing collection from one customer and concealing this defalcation by applying a subsequent collection made from another customer

Answer 43

Lapping

Question 44

Happens when a check is drawn from one bank and is deposited to another bank at end of the month of year

Answer 44

Lapping