Rift Valley University Campus

Financial Management –I
Assignment
1. What are the external sources of finance?
_________________________________________________________________________________
_________________________________________________________________________________
_________________________________________________________________________________
_________________________________________________________________________________
2. List out the internal sources of finance?
_________________________________________________________________________________
_________________________________________________________________________________
_________________________________________________________________________________
_________________________________________________________________________________

3. List the objectives of financial management.

_________________________________________________________________________________
_________________________________________________________________________________
_________________________________________________________________________________
_________________________________________________________________________________
4. Why profit maximization is criticized?
_________________________________________________________________________________
_________________________________________________________________________________
_________________________________________________________________________________

5. What is analysis of financial statements?

_________________________________________________________________________________
_________________________________________________________________________________
_________________________________________________________________________________
6. Analysis which is done by the persons within the organization is called.
_________________________________________________________________________________
_________________________________________________________________________________
_________________________________________________________________________________
_________________________________________________________________________________
7. Name the financial statements.
_________________________________________________________________________________
_________________________________________________________________________________
_________________________________________________________________________________
_________________________________________________________________________________
8. List the users of financial statements.
_________________________________________________________________________________
_________________________________________________________________________________

A. G. FM-I Page 1
_________________________________________________________________________________
_________________________________________________________________________________

9. How can you classify the Ratio?

_________________________________________________________________________________
_________________________________________________________________________________
_________________________________________________________________________________
_________________________________________________________________________________
10. Give two examples of Balance Sheet ratios.
_________________________________________________________________________________
_________________________________________________________________________________
_________________________________________________________________________________
_________________________________________________________________________________

11. What does Debt-equity ratio reveal?

_________________________________________________________________________________
_________________________________________________________________________________
_________________________________________________________________________________
_________________________________________________________________________________
12. Give the formula for calculating Debt to total capital ratio.
_________________________________________________________________________________
_________________________________________________________________________________
_________________________________________________________________________________
_________________________________________________________________________________
13. What for interest coverage ratio useful?
_________________________________________________________________________________
_________________________________________________________________________________
_________________________________________________________________________________
_________________________________________________________________________________
14. What does dividend coverage ratio measure?
_________________________________________________________________________________
_________________________________________________________________________________
_________________________________________________________________________________
_________________________________________________________________________________

15. Give two examples of liquidity ratios.

_________________________________________________________________________________
_________________________________________________________________________________
_________________________________________________________________________________
_________________________________________________________________________________
16. Name three current assets.
_________________________________________________________________________________
_________________________________________________________________________________

A. G. FM-I Page 2
_________________________________________________________________________________
_________________________________________________________________________________
17. List out three current liabilities.
_________________________________________________________________________________
_________________________________________________________________________________
_________________________________________________________________________________
_________________________________________________________________________________
18. How is current ratio calculated?
_________________________________________________________________________________
_________________________________________________________________________________
_________________________________________________________________________________
_________________________________________________________________________________
19. What does quick ratio measure?
_________________________________________________________________________________
_________________________________________________________________________________
_________________________________________________________________________________
_________________________________________________________________________________

20. What is Total Assets Turnover Ratio?

_________________________________________________________________________________
_________________________________________________________________________________
_________________________________________________________________________________
_________________________________________________________________________________
21. How is Gross profit margin calculated?
_________________________________________________________________________________
_________________________________________________________________________________
_________________________________________________________________________________
_________________________________________________________________________________
22. What is operating ratio?
_________________________________________________________________________________
_________________________________________________________________________________
_________________________________________________________________________________
_________________________________________________________________________________
23. What do you understand by Earnings Per Share (EPS)?
_________________________________________________________________________________
_________________________________________________________________________________
_________________________________________________________________________________
_________________________________________________________________________________
24. How is price earnings ratio calculated?
_________________________________________________________________________________
_________________________________________________________________________________
_________________________________________________________________________________
_________________________________________________________________________________

A. G. FM-I Page 3