An effective process of capital allocation promotes productivity and provides an efficient market for buying and selling securities and obtaining and granting credit.
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- TRUE-FALSE–Conceptual Financial accounting is the process of identifying, measuring, analyzing, and communicating financial information needed by management to plan, evaluate, and control an organiza-tion's operations. 1. 2. Financial statements are the principal means through which financial information is communicated to those outside an enterprise. 3. Users of the financial information provided by a company use that information to make capital allocation decisions. An effective process of capital allocation promotes productivity and provides an efficient market for buying and selling securities and obtaining and granting credit. 4. Financial reports in the early 21st century did not provide any information about a company's soft assets. 5.Determine the response that best completes the following statements or questions.1. The primary objective of financial reporting is to provide informationa. About a firm’s management teamb. Useful to capital providersc. Concerning the changes in financial position resulting from the income-producing efforts of the entityd. About a firm’s financing and investing activitiesThe goal of management accounting is to: a. Help bankers to make lending decisions b. Help the government to monitor company’s activities c. Help the investors to make decisions d. Help managers to make decisions
- Indicate whether the following statements are (True) or (False) and correct the false statements Profit maximization is the main goal of a business organization. The net accounting profit is the difference between the cash inflows and cash outflows of a given project. Financial markets are intermediaries that channel the savings of individual, businesses, and governments into loans or investments.Select all that is true about the role of financial managers and the types of financial decisions they make. a. Capital Budgeting function involves planning and determining the firm’s short term investments. b. Determining the appropriate level of inventory is a working capital management function. c. The duties of the financial manager includes determining the capital structure and which projects the firm should undertake. d. Capital structure describes the mix of short-term liabilities a firm uses to finance its short-term assets. e. The optimal financial management strategy of a financial manager is to reduce the overall risk level of the firm. f. Size and timing of cash flows is unimportant in a capital budgeting decision.The primary objective of financial reporting is to provide informationa. useful for making investment and creditdecisions.b. on the cash flows of a company.c. about the profitability of an enterprise.d. to the federal government.
- The ultimate goal of the financial system in a market economy is to make the price of financial assets correctly reflect their true value (informational efficiency) achieve the financial equality among different people and organizations make the costs of financial transactions as low as possible (operational efficiency) allocate funds to their best use (allocational efficiency)The objectives of financial reporting include which of the following? a. Financial reporting should provide information ·a. that is comprehensibie to all potential investors. b. Financial reporting should provide information directly to potential investors about the nature, timing, and uncertainty of prospective cash dividends. c. Financial reporting should provide information that is useful to potential investors in making rational investment decisions. d. Financial reporting shouid provide information about an enterprise's economic resources bưt not about circumstances that change those resources.Financial statement analysis is the process of analyzing a company's financialstatements for decision-making purposes. External stakeholders use it to understand the overall health of an organization as well as to evaluate financial performance and business value. Internal constituents use it as a monitoring tool for managing finances. Differentiate the three main types of financial statements: the balance sheet, income statement, and cash flow statement ???
- _____is that business activity which is concerned with the acquisition and conversion of capital funds in meeting financial needs and overall objectives of business enterprises a. Structured Finance Ob. Business Finance Oc. Legali Od. SourcingSelect all that is true about the role of financial managers and the types of financial decisions they make. Select one or more: a. Capital structure describes the mix of short-term liabilities a firm uses to finance its short-term assets. b. The optimal financial management strategy of a financial manager is to reduce the overall risk level of the firm. c. The duties of the financial manager includes determining the capital structure and which projects the firm should undertake. Od. Size and timing of cash flows is unimportant in a capital budgeting decision. e. Capital Budgeting function involves planning and determining the firm's short term investments. Of. Determining the appropriate level of inventory is a working capital management function. ZA do W X L. is modifying the firm's credit collection policy with its customers Select one: a.Financial accounting b.Working capital management c.Capital budgeting d.Capital structure