Basics of Accounting

Financial Analysis

Quiz Result

Quiz Completion Time : 00:03:05

Wrong/Skipped

Right Answer

Your Score : 100%

Passing Score : 50%

Areas to Focus:

Lesson - Financial Decision Making

Lesson - Financial Information, Users & Financial Statements

1. Which Financial Statement provides information about a company's cash inows and outows from
operating, investing, and nancing activities?

Your Answer : Statement of Cash Flows

Description : The statement of cash ows presents information about the cash inows and outows of a
company categorized into operating activities (e.g., cash from sales), investing activities (e.g., cash from the
purchase or sale of assets), and nancing activities (e.g., cash from borrowing or issuing stock).

Question Reference From : Financial Information, Users & Financial Statements

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2. Which nancial statement provides information about a company's assets, liabilities, and shareholders'
equity at a specic point in time?

Your Answer : Balance Sheet

Description : The balance sheet provides a snapshot of a company's nancial position at a specic date,
showing its assets (what it owns), liabilities (what it owes), and shareholders' equity (the owners'
investment in the company).

Question Reference From : Financial Information, Users & Financial Statements

3. The primary objective of Dividend Policy is to:

Your Answer : Maximize shareholder wealth

Description : The primary objective of dividend policy is to maximize the wealth of the shareholders.
Financial managers make dividend decisions that strike a balance between distributing prots to
shareholders and retaining earnings for future growth, considering the impact on shareholder value and
investor expectations.

Question Reference From : Financial Decision Making

4. Financial Decision Making aims to:

Your Answer : Optimize the company's capital structure

Description : Financial decision making involves determining the most appropriate mix of debt and equity
nancing to fund the company's operations and investments. The objective is to optimize the capital
structure by balancing the cost of capital, nancial risk, and exibility to maximize the overall value of the
company.

Question Reference From : Financial Decision Making

5.
d)
The main areas focused on by the nancial managers a) Financing b) Investmentc) Asset
Dividend
in the decision-making process are: Decisions Decision Management
Policy

Your Answer : All (a), (b), (c), and (d)

Description : The main areas focused by nancial managers in the decision-making process are:a)
Financing decisions: Financial managers are responsible for making decisions related to the nancing of
the company's operations, such as deciding on the appropriate mix of debt and equity nancing, issuing
new securities, and managing the company's cash ow.b) Investment decisions: Financial managers are
also responsible for making decisions related to the investment of the company's resources, such as
deciding which projects to invest in, evaluating the risk and return of potential investments, and managing
the company's portfolio of investments.c) Asset management: Financial managers are responsible for
managing the company's assets, including managing the company's working capital, inventory, and xed
assets.d) Dividend policy: Financial managers are also responsible for making decisions related to the
distribution of the company's prots to shareholders, such as determining the amount and timing of

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 dividend payments.Overall, the primary role of nancial managers is to make strategic nancial decisions
that optimize the company's nancial performance and maximize shareholder value.

Question Reference From : Financial Decision Making

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