A business is considered to be financially efficient: 1.If they have more current assets than current liabilities 2.If they use their capital effectively 3. If they have more assets than liabilities 4.If they have more liabilities than assets
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- The primary purpose of finance is to __________. a.) keep track of a business's cash flow b.) manage assets in a way that maximizes returns c.) study the effects of the economy on businesses d.) pay off debt as quickly as possibleIn order to run a business, operations must be funded from day to day. In order to fund their ventures, many business owners turn to investors to help financially. What is the resulting investment called? a) Capital b) Corporate dividends c) Expenses d) RevenueThe financial needs of a business do not include the following? A. Investors must receive a very good rate of return from a financial institution. B. A business must meet its financial obligations and pay its debts C. To stay competitive, but a firm must finance future growth and development D. All of a business’s activities must be profitable
- The ability of a business to pay its debts as they come due and to earn a reasonable net income is a. solvency and equity b. solvency and profitability c. solvency and leverage d. solvency and liquidityAssume that you are a financial manager and significant owner of a successful medium-sized business. You want to grow your business and use your financial assets effectively. What should you do?‘The statement of financial position shows how much a business is worth.’ Do you agree with this statement? Explain the reasons for your response.
- Direction: Identify what describes the following statement. Write your answer on the blank before the number. ____________________1. It pertains to the state of one’s personal monetary affairs. ____________________2. It measures the ability to generate earnings from its resources or investments. ____________________3. It measures the ability to generate profit that ensures to pay business expenses and maintain a long-term financial success of the business. ____________________4. It measures the ability of the company to settle its short term debts. ____________________ 5. It measures how the business manage its assets or resources to produce output without wastage. ____________________6. It presents the financial statement amounts as a percentage of a base number. ____________________7. It is used to evaluate a number of issues with an entity, such as its liquidity, efficiency of operations, and profitability. ____________________8. These users of financial information are…Capital is the major part of all kinds of business activities, which are decided by the size, and nature of the business concern. Capital may be raised with the help of various sources. If the company maintains proper and adequate level of capital, it will earn high profit and they can provide more dividends to its shareholders. required : a) Define capital structure. b) Discuss the various factors affecting the capital structure.I. Direction: Identify what describes the following statement. Write your answer on the blank before the number. ____________________1. It pertains to the state of one’s personal monetary affairs.____________________2. It measures the ability to generate earnings from its resources or investments. ____________________3. It measures the ability to generate profit that ensures to pay business expenses and maintain a long-term financial success of the business. ____________________4. It measures the ability of the company to settle its short term debts. ____________________ 5. It measures how the business manage its assets or resources to produce output without wastage. ____________________6. It presents the financial statement amounts as a percentage of a base number. ____________________7. It is used to evaluate a number of issues with an entity, such as its liquidity, efficiency of operations, and profitability. ____________________8. These users of financial information are interested…
- In the three types of business activities, which type is least likely to show positive cash flows in a successful, growing business? Why?Factors that reflect the ability of a business to pay its debts and earn a reasonable amount of income are referred to as solvency, profitability, and liquidity.26. How the cost of reporting financial information should be justified? a. By the number of transactions b. By the benefits of reporting that information c. By the amount of capital d. By the size of the business organization