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WGU C708 Principles of Finance Exam 2023 Questions and Answers (Verified Answers)
1.1. The credit manager for a company is responsible for setting the
compa- ny's credit policy regarding availability and limits for customers.What is one of the additional responsibilities of this credit manager?A.Purchasing insurance B.Collecting past-due accounts C.Monitoring accounts payable D.Investing excess cash ANS B. Collecting past-due accounts
2.2. Which activity is financial management responsible for?
A.Researching different products to bring to market B.Reporting past earnings for shares of stock 1 / 4
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C.Ensuring sufficient financing is available D.Verifying the balance sheet is properly constructed ANS C. Ensuring sufficient financing is available
3.3. What is one of the main areas of the financial environment?
A.Human resources B.Marketing C.Investments D.Foreign relations ANS C. Investments
4.4. What is a common challenge in the world of finance?
A.It causes investor anxiety due to a volatile stock market B.It generally operates with a high degree of uncertainty C.It is difficult to abide by generally accepted accounting principles.
(GAAP) 2 / 4
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D.It has to comply with banking regulations that are subject to change ANS B. It generally operates with a high degree of uncertainty
5.5. Which variable must be considered when a corporation's finance
depart- ment is determining the best strategy for financing a project?A.The amount of trade credit from suppliers for the project B.Recent changes to the federal funds rate C.The bid-ask spread for the company's stock D.The amount of debt and equity financing currently in use ANS D. The amount of debt and equity financing currently in use
6.6. An individual is interested in establishing a lawn care business as a
sole proprietorship. What will be a disadvantage of choosing this business model?A.Frozen investments B.Unlimited liability C.Government regulations 3 / 4
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D.Management disagreements ANS B. Unlimited liability
7.7. What is one benefit of a sole proprietorship?
A.The owner has uninterrupted control of the business B.The company can continue to exist with the death of the owner C.The business is taxed separately from the owner's personal taxes D.The personal assets of stockholders are protected ANS A. The owner has unin- terrupted control of the business
8.8. What is a disadvantage of a general partnership?
A.Owner's personal assets are not protected against claims of creditors
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