Corporate Finance Study Set 12

The need to manage net working capital arises because:

Which of the following is not considered one of the basic questions of corporate finance?

A corporate security can be viewed as a contingent claim on the firm. This means that:

Using the balance sheet model of the firm, finance may be thought of as analysis of three primary subject areas. Which of the following groups correctly lists these three areas?

The cheapest business entity to form is typically the:

The Simple Corporation has outstanding obligation to the Complex Corporation of $250. It is year-end and the total cash flow of Simple from all sources is $325. The contingent payoff to the debtholders and the equity shareholders is:

Inventory is a component of:

The balance sheet is made up of what five key components:

In a general partnership, the general partners have _____ liability and have _____ control over day-to-day operations.

If a firm has debt outstanding the contingent claim of an equity shareholder is:

Time preference refers to the fact that:

Which one of these is a cash outflow from a corporation?

The Splitz Corporation has borrowed $5 million in debt with a promise to repay $5.5 million in one year. The corporation had 10 million shares outstanding worth $2 each at the time of the borrowing. Splitz earns $6 million during the year. What is the debtholder's contingent claim; how much do the debtholders receive; and, how much do the equity holders receive?

The division of profits and losses among the members of a partnership is formalized in the:

In the managerial structure of the corporation the two officers and their responsibilities that report directly to the Chief Financial Officer are:

The general partner(s) in a general partnership agree to share work, costs and profits and losses. Each partner:

Value is created and recognized over time if:

In terms of the balance sheet model of the firm, the value of the firm in financial markets is equal to:

The Splitz Corporation has borrowed $5 million in debt with a promise to repay $5.5 million in one year. The corporation had 10 million shares outstanding worth $2 each at the time of the borrowing. Splitz earns $5 million during the year. What is the debtholder's contingent claim; how much does the debtholder receive; and, how much do the equity holders receive?

The ultimate control of a corporation lies in the hands of the corporate: