TEST FIN2603 - SESSION 2 2023/2024

Financial management is a process to ensure that financial resources are obtained & used profitably and effectively to accomplish the firm’s objective.

• TRUE

• FALSE

The assets management decision explains how assets have been acquired and must be managed efficiently to help the firm maximize risk and return.

• TRUE

• FALSE

In Malaysia, the money market consists of a primary market and a secondary market.

• TRUE

• FALSE

The purpose of maintaining raw materials inventory is to incorporate between purchasing and production of the business.

• TRUE

• FALSE

The Inflation risk will increase the purchasing power of financial instruments.

• TRUE

• FALSE

The credit term of 5/15 net 35 indicates a 5% discount if payment is made within 15 days and the last discount to claim is on day 35.

• TRUE

• FALSE

Cash discount given to encourage customer to buy in bulk.

• TRUE

• FALSE

An aggressive working capital policy would have low liquidity, higher risk, and higher profitability potential.

• TRUE

• FALSE

Working capital is composed of the firm’s current assets and non-current assets.

• TRUE

• FALSE

Collateral is one of the criteria in the process of credit selection for customers who purchase in small monetary amounts.

• TRUE

• FALSE