HSC Business Studies - Finance

Question 1

Which of these is NOT a profitability financial ratio?

Accepted Answer

Expense Ratio

Question 2

The Gross Profit ratio is better when the figure is higher

Accepted Answer

True

Question 3

Which of these are influences in financial management?

Accepted Answer

Financial Institutions, Global market inlfuences, Governement, Internal & external sources of finance

Question 4

What does a cash flow statement show?

Accepted Answer

The movement of cash receipts and cash payments over time

Question 5

Which of these are internal sources of finance?

Accepted Answer

Retained profits, Owners' equity

Question 6

Which of these is long term debt borrowing?

Accepted Answer

Leasing, Debentures, Unsecured notes, Mortgage

Question 7

Which of these is a financial management strategy?

Accepted Answer

Working capital management, Cash flow management, Profitability management, Global financial management

Question 8

The liquidity financial ratio is...

Accepted Answer

Current (Working Capital) Ratio

Question 9

What does ASX stand for?

Accepted Answer

Australian Securities Exchange

Question 10

What is the best strategy for dealing with working capital management?

Accepted Answer

Leasing

Question 11

What does the accounting equation show?

Accepted Answer

Relationship between assets, liabilities and owners equity

Question 12

What is a disadvantage of debt finance?

Accepted Answer

Requirement of security, Increased risk

Question 13

Which one of these is NOT a global market influence?

Accepted Answer

Australian Securities and Investment Commission

Question 14

Which of these is NOT an objective of financial management?

Accepted Answer

Goals

Question 15

The Current (Working Capital) Ratio is: Current ratio =

Accepted Answer

Current assets / Current liabilities

Question 16

What can management do to avoid shortfalls in cash?

Accepted Answer

Offer creditors a discount for early payments, Distribute payments throughout the year

Question 17

What does gearing show?

Accepted Answer

Proportion of debt and equity used to finance the business

Question 18

Premises, machinery, vehicles, cash, patents, trademarks and goodwill are examples of what?

Accepted Answer

Assets

Question 19

What is owners' equity?

Accepted Answer

Funds contributed by the owners

Question 20

Liabilities + Owners' Equity =

Accepted Answer

Assets

Question 21

What is an advantage of equity finance?

Accepted Answer

Cheaper, Does not have to be repaid unless the owner leaves business, Low gearing

Question 22

Which two ways can you fund a business?

Accepted Answer

Debt & Equity

Question 23

Which of the following indicates the effectiveness of a firms credit policy?

Accepted Answer

Accounts Receivable Turnover ratio

Question 24

What is the word for information in quantitative terms about requirements to achieve a purpose?

Accepted Answer

Budgets

Question 25

Which of the following is NOT an example of an international payment method?

Accepted Answer

Open account

Question 26

The ability to source funds by selling accounts receivable discounted to another firm is...

Accepted Answer

Factoring

Question 27

Which of these are a method of payment for global businesses?

Accepted Answer

Payment in advance, Letter of credit

Question 28

Which of these is an objective of financial management?

Accepted Answer

Efficiency, Liquidity

Question 29

What is an advantage of debt financing?

Accepted Answer

funds readily available, Interest payments are tax deductable

Question 30

How is finance interdependent with the the other key business functions?

Accepted Answer

Promoting new product, Designing a functional, innovative product, Recruiting skilled employees, Purchasing raw materials

Question 31

Two strategies for managing working capital include...

Accepted Answer

Leasing and factoring

Question 32

What limitations does financial reporting have?

Accepted Answer

Normalised earnings, Timing issues, Valuing assets

Question 33

A high Debt to Equity ratio indicates...

Accepted Answer

A less solvent firm and higher risk in business

Question 34

A financial audit is the...

Accepted Answer

independent check of accuracy of accounting records

Question 35

Which of these are tangible assets?

Accepted Answer

Cash, Machinery

Question 36

Which means the ability of a business to meet its financial commitments in the short term?

Accepted Answer

Liquidity

Question 37

Which of these is a strategy for minimising expenses?

Accepted Answer

Eliminating waste

Question 38

Two examples of fixed costs for a business are...

Accepted Answer

Insurance and lease

HSC Business Studies - Finance

Questions 38

HSC Business Studies - Finance

Questions 38