Functions of Financial Management 35 Multiple Choice Questions All of the following are functions of the financial manager except a. Analyzing and planning the company’s performance, b. Anticipating the company’s financial needs. c. Assigning the market price of the company’s stock d Allocating funds to the most profitable asset. Which of the following statements is false? a, The financing decision involves the process of allocating funds for investment in competing assets. b. The treasurer would be responsible for activities such as managing cash balances, granting credit to customers and managing the process of issuing new securities. ¢. The optimal capital structure is the best combination of long-term debt and equity. d. It is necessary to determine the appropriate risk-return trade-off to maximize the market value of the firm for its shareholders. Regine is a financial manager who has discovered that her company is violating environmental regulations. If her immediate superior is involved, her appropriate action is to a. — do nothing since she has a duty of loyalty to the organization. b. consult the audit committee. ¢. present the matter to the next higher managerial level. d. confront her immediate superior, If a_finaneial manager discovers unethical conduct in his/her organization and fails to act, he/she will be in violation of which ethical standard(s)? a. “Actively or passively subvert the attainment of the organization’s legitimate and ethical objectives.” b. “Communicate unfavorable as well as favorable information.” . c. “Condone the commission of such acts by others within their organizations.” d. All of the answers are correct,36 Chapter 3 wuirement for all finan jal managers. One 5. ty is an ethical rea of integrity rea sssional duties in accordance with applicable Integr t ff Performance of pro laws. . . b. avoidance of conflict oe 7 inside information. ining from improper Us : A financial manager diseovers a problem that could mislead users of the firm’s financial data and has informed his/her immediate ‘superior, He/she should report the circumstances to the audit committee and/or the board of directors only if a. the immediate superior, who reports to the chief executive officer, knows about the situation but refuses to correct it. b. the immediate superior assures the financial manager that the problem will be resolved. c. the immediate superior reports the situation to his/her superior. the immediate superior, the firm’s chief executive officer, knows about the situation but refuses to correst it.