Business Management And Law Ch 8: Financial Management Test
BML Financial Management
- 1.List containing information on each customer, what they purchased, the value of the item(s) purchased, and how much they owe for each credit sale.
- A.
Accounts receivable
- B.
Accounts payable
- C.
Long-term assets
- D.
Cash records
- 2.The differences between actual and budgeted performance are known as ___.
- A.
Discrepancies
- B.
Shortages
- C.
Overages
- D.
Windfalls
- 3.Assets, liabilities, and owners' equity for a specific date are listed on a financial statement called the ___.
- A.
Balance sheet
- B.
Income statement
- C.
Asset records
- D.
Credit records
- 4.Which of these is used to keep track of the lost value of assets due to time or usage?
- A.
Depreciation records
- B.
Inventory records
- C.
Tax records
- D.
Records of accounts
- 5.Which two of these are most likely to cause a business legal problems if not kept accurately?
- A.
Asset records
- B.
Depreciation records
- C.
Inventory records
- D.
Records of accounts
- E.
Cash records
- F.
Payroll records
- G.
Tax records
- 6.All income that a business receives over time is called
- A.
Revenue
- B.
Assets
- C.
Expenses
- D.
Liabilities
- 7.Records that identify the type and number of products on hand for sale.
- A.
Inventory records
- B.
Asset records
- C.
Accounts receivable
- D.
Accounts payable
- 8.Records that contain information on all employees, their compensation and benefits are known as ___.
- A.
Asset records
- B.
Payroll records
- C.
Account records
- D.
Inventory records
- 9.Which of these contains records of the buildings, land and equipment that a business owns?
- A.
Asset records
- B.
Inventory records
- C.
Account records
- D.
Tax records
- 10.Which ratio tells you how much the business is relying on borrowed money?
- A.
Current ratio
- B.
Debt to equity ratio
- C.
Return on equity ratio
- D.
Net income ratio
- 11.Amounts that company will pay off within one year.
- A.
Current liabilities
- B.
Long-term liabilities
- C.
Current assets
- D.
Accounts receivable
- 12.Refers to income taxes, Social Security, Medicare, and unemployment taxes.
- A.
Payroll taxes
- B.
FICA taxes
- C.
Luxury taxes
- D.
Capital gains taxes
- 13.Which ratio tells you whether a business can pay its debts as they come due?
- A.
Current ratio
- B.
Debt to equity ratio
- C.
Return on equity ratio
- D.
Net income ratio
- 14.The costs of operating a business.
- A.
Revenue
- B.
Assets
- C.
Losses
- D.
Expenses
- 15.Cash and items that can readily be converted into cash are known as
- A.
Current assets
- B.
Current ratio
- C.
Long-term assets
- D.
Current liabilities
- 16.The main source of financial information established businesses use to prepare a budget is
- A.
The company's past financial records.
- B.
The Small Business Administration.
- C.
The Wall Street Journal.
- D.
Accountants and bankers.
- 17.If a budget contains several discrepancies, the LAST adjustment that managers should attempt is to
- A.
Find ways to increase revenue.
- B.
Redo the budget.
- C.
Seek ways to cut expenses.
- D.
Double-check their calculations.
- 18.This is an estimate of the actual money a business received and paid out for a specific period.
- A.
Start-up budget
- B.
Operating budget
- C.
Short-term budget
- D.
Cash budget
- 19.Liabilities are
- A.
What a company owes.
- B.
The value of the owners' investment in the company.
- C.
What a company owns.
- D.
What a company has on hand to sell.
- 20.All of the following are fixed assets EXCEPT
- A.
Land.
- B.
Inventory.
- C.
Expensive technology.
- D.
All of these are fixed assets.
- 21.Which of these identifies the companies from which credit purchases were made?
- A.
Cash record
- B.
Payroll record
- C.
Accounts payable record
- D.
Accounts receivable record
- 22.A company's sales and profits for a specific period are listed in the company's
- A.
Income statement.
- B.
Operating budget.
- C.
Balance sheet.
- D.
Cash budget.
- 23.Which of the following is NOT a common payroll deduction?
- A.
Income tax
- B.
Social Security
- C.
Health insurance
- D.
Unemployment tax
- 24.An earnings report includes
- A.
The employee's job title.
- B.
The number of sick days an employee has available.
- C.
The amount of deductions for the current pay period.
- 25.A company's liabilities divided by the owners' equity is the
- A.
Current ratio
- B.
Debt to equity ratio
- C.
Return on equity ratio
- D.
Net income ratio
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