Answered: Financial managers should consider this…

Business

Finance

Financial managers should consider this when.improving the financials of the firm

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter13: Sustainability Reporting

Section: Chapter Questions

Problem 11MC: Which of the following statements is most often the case? A. Socially responsible businesses tend to...

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Which of the following statements is most often the case? A. Socially responsible businesses tend to post higher profits than those not focused on social responsibility. B. Companies that are not socially responsible will have better profits, but have a moral obligation to society. C. Socially responsible investing gives poorer returns than non-socially responsible Investing. D. Investors are more short termed focus and so socially responsible investing should not be a factor in their investment portfolio.
An important goal of a responsibility accounting framework is to help ensure which of the following? A. decision-making is made by the top executives. B. investments made by each segment are minimized. C. identification of operating segments that should be closed. D. segment and company financial goals are congruent.
The chapter encourages analysts to develop forecasts that are realistic, objective, and unbiased. Some firms managers tend to be optimistic. Some accounting principles tend to be conservative. Describe the different risks and incentives that managers, accountants, and analysts face. Explain how these different risks and incentives lead managers, accountants, and analysts to different biases when predicting uncertain outcomes.
Consider the dilemma you might someday face if you are the chief financial officer of a company that is struggling to maintain a positive cash flow, despite the fact that the company is reporting a substantial positive net income. Maybe the problem is so severe that there is often insufficient cash to pay ordinary business expenses, like utilities, salaries, and payments to suppliers. Assume that you have been asked to communicate to your board of directors about your companys year, in retrospect, as well as your vision for the companys future. Write a memo that expresses your insights about past experience and present prospects for the company. Note that the challenge of the assignment is to keep your integrity intact, while putting a positive spin on the situation, as much as is reasonably possible. How can you envision the situation turning into a success story?
Consider the dilemma you might someday face if you are the CFO of a company that is struggling to satisfy investors, creditors, stockholders, and internal company managers. All of these financial statement users are clamoring for higher profits and more net assets (also known as equity). If at some point, you suddenly found yourself not meeting the internal and external earnings and equity targets that these parties expect, you would probably search for some way to make the financial statements look better. What if your boss, the CEO, suggested that maybe you should make just one simple journal entry to record all the goods that your company is holding on consignment, as if that significant amount of goods were owned by your company? She might say that this action on your part would fix a lot of problems at once, since adding the consigned goods to merchandise inventory would simultaneously increase net assets on the balance sheet and increase net income on the income statement (since it would decrease cost of goods sold). How would you respond to this request? Write a memo, detailing your willingness or not to embrace this suggestion, giving reasons behind your decision. Remember to exercise diplomacy, even if you must dissent from the opinion of a supervisor. Note that the challenge of the assignment is to keep your integrity intact while also keeping your job, if possible.
Which of the following statements is true? a. Determining how day-to-day financial matters should be managed is not a function of financial managers. B. The goal of the firm is to maximize market share. C. Working capital management refers to identifying productive long-term assets the firm could acquire to maximize net benefits. D. Capital budgeting refers to identifying productive long-term assets the firm could acquire to maximize net benefits.
According to your textbook, the financial manager should attempt to maximize the wealth of the firm’s shareholders by achieving the highest possible value for the firm. 1) Please explain how this concept is different from the idea of earning the highest possible profit for the firm; 2) explain how social responsibility and ethical behavior on the part of corporate management affects the value of the firm; 3) discuss the “Agency Theory” and how that relates to the goal of achieving the highest value for the firm.
Which of the following statements about responsible return on investment is not true? Responsible return on investment is a tool for the main goal of calculating how much money a company makes from responsible business activities. includes components related to sustainability, responsibility, and ethics into its calculation. may be split up into the triple bottom line return on investment, stakeholder value return on investment, and the ethical return on investment. Question 26 Which of the following exemplary activities is part of the financing phase of responsible financial management? Deciding which community project to implement, based on the social impact of each project. Using the social return on investment to understand how much value your different responsible management activities create. Creating revenues through a social marketing campaign which are then used to fund the position of a responsibility officer. Establishing a governance system. Question 27 A protester at…
As a financial manager,;one's goalsfor the client is to help them dothe following EXCEPT: A. Build credit by encouraging them to acquire as many loan as possible so that the firm value or the total asset of the firm will increase.B. Identify investment opportunities and determine whether these are acceptable to their risk preference.C. Determine ways to reduce non-value adding costsD. Create budgets that would enable them to determine excess or inadequacy of cash.
Which of the following best describes the potential impact of business risk on Earnings Quality? Select one: a. Business risk is mostly composed of financial risk factors and it has minimal effect on earnings quality. b. Higher earnings quality is linked with companies more insulated from business risk. While business risk is not primarily a result of management’s discretionary actions, this risk can be lowered by skillful management strategies.' c. A higher level of earnings quality can be observed in the industries with high business risk, because higher risk means higher returns d. For managing business risk, the managers almost have no discretion, therefore business risk is not directly or indirectly related to earnings quality.
Tutorial Questions Explain to John, your mentor, the primary goal of the organization? Your manager is requesting you to provide an explanation to the question. Would the role of a financial manager be likely to increase or decrease in importance if the rate of inflation increased? What is the difference between stock price maximization and profit maximization? What are the three principal forms of business organization? What are the advantages and disadvantages of each? What mechanisms exist to influence managers to act in shareholders’ best interests? What is an agency relationship? What agency relationships exist within a corporation? What are financial intermediaries, and what economic functions do they perform? How does an efficient capital market help to reduce the prices of goods and services? What is the term structure of interest rates? What is a yield curve? How should users and savers of…
Please answer ASAP.Financial performance measures are essential tools used by managers to evaluate the financialhealth of their organization. They provide an overview of the company's financialperformance, help identify areas of improvement, and support decision making.CarniTrin is a manufacturer of Carnival costumes in a highly competitive market. Thecompany's management team is seeking guidance on the use of financial performancemeasures to identify the key drivers of the company's financial performance and develop astrategy to improve it.The following data relate to the company for the year 2019: In its clothing division, the company has $4,000,000 invested in assets. After-taxoperating income from sales of clothing in 2019 is $700,000. Income for the clothingdivision has grown steadily over the last few years. The cosmetics division has $12,000,000 invested in assets and an after-tax operatingincome in 2019 of $1,700,000. The weighted-average cost of capital for CarniTrin is 10%…