291297flashcard

Front

What is the primary goal of business finance?

Back

Maximizing shareholder wealth

Front

Which of the following is considered a current asset on a company’s balance sheet?
Options: Inventory and equipment, Long-term investments, Accounts payable, Cash and accounts receivable

Back

Cash and accounts receivable

Front

What does the term “liquidity” refer to in business finance?

Back

Liquidity refers to the ease of converting assets into cash.

Front

Which financial statement shows a company’s revenues, expenses, and profits over a period of time?

Back

Income Statement

Front

What does the term “capital structure” refer to?

Back

The mix of debt and equity financing used by a company.

Front

What is the formula for calculating the return on equity (ROE)?

Back

ROE = Net Income / Shareholder's Equity

Front

Which of the following is NOT a source of long-term financing for a business? Retained earnings, Equity financing, Short-term loans, Venture capital

Back

Short-term loans

Front

What is the purpose of financial forecasting in business finance?

Back

To predict future financial outcomes and plan accordingly

Front

Which of the following ratios is used to measure a company’s profitability? Gross profit margin, Debt to equity ratio, Return on assets, Current ratio

Back

Gross profit margin

Front

What does "working capital" measure in business finance?

Back

The difference between a company’s current assets and current liabilities