This study source was downloaded by 100000872171310 from CourseHero com on 09 20 2023 09 59 24 GMT 05 00 https www coursehero com file 80489735 Prelim Examdocx It is a body of facts principles and theories relating to raising and using money by individuals businesses and governments Finance AccountingManagement Advisory ServicesFinancial Management A decision making process concerned with planning acquiring and utilizing funds in a manner that achieves the firm s desired goals Financial ManagementAccountingFinanceManagement Advisory Services Area of decision which determines how scarce or limited resources in terms of funds of the business are committed to projects Investment DecisionFinancing DecisionDividend decisionOperating DecisionIt asserts that the mix of debt and equity chosen that should maximize the value of investments made Financing DecisionDividend decisionOperating DecisionInvestment Decision It is concerned with the determination of profits to be distributed to the owners the frequency of such payments and the amounts to be retained by the firm Dividend decisionOperating Decision Financing DecisionInvestment Decision Statement 1 Finance is a part of a larger discipline of Financial ManagementStatement 2 Financial Management is also referred to as managerial finance corporate finance or business finance False TrueFalse FalseTrue FalseTrue True Statement 1 The basic objective of the investment financing and dividend decisions is to maximize thefirm s wealthStatement 2 The goal of financial management is to maximize the current value per share of the existing stock or ownership in a business firm True True True False False FalseTrue False This study source was downloaded by 100000872171310 from CourseHero com on 09 20 2023 09 59 24 GMT 05 00 https www coursehero com file 80489735 Prelim Examdocx Statement 1 A firm having latest technology sophisticated machinery high calibre marketing and technical experts may fail unless its finances are managed on sound principles of financial management thus management of finance reduces the chances of failureStatement 2 Finance function reduces the chances of failure because it enables the other functions of production marketing purchasing and personnel to be effective in the achievement of financial objective goals and objectives of maximizing owner s wealth True FalseFalse False False TrueTrue True It is an aspect of financial management which considers the amount of cash flows expected to be generated for the benefits of owners the timing of these cash flows and the risk attached to these cash flows Measurement of ROI Broad Applicability Reduction of Chances of Failure Areas of Decisions It involves planning forecasting provision of finance and formulation of policies which lead the firm s survival and success Strategic financial planningStrategic PlanningStrategic Financial ManagementBusiness Plan It reflects how business achieve its goals and objectives Business PlanStrategic financial planningStrategic PlanningStrategic Financial Management Maximization of return on capital employed or return on investment minimization of finance charges are an example ofShort Medium Term financial objectives Short term financial objectivesMedium Term financial objectives Long Term financial objectives The level of cash securities and inventory that should be kept on hand credit policy source of short term financing are an example of areas of decision ofOperating DividendFinancingInvestingEvaluation selection of capital investment proposal prioritization of investment alternatives funds This study source was downloaded by 100000872171310 from CourseHero com on 09 20 2023 09 59 24 GMT 05 00 https www coursehero com file 80489735 Prelim Examdocx allocation and its rationing are example of areas of decision of InvestingFinancingDividendOperating Financial Manager makes decision involving the following exceptAuditAnalysis PlanningAcquisition of fundsUtilization of funds The following are the functions of Treasurer exceptTax managementCash managementCredit managementFinancial Planning The following are the functions of Controller except Financial PlanningTax managementCost accumulationData processing It is the process of monitoring managers and aligning their incentives with shareholders goals Corporate GovernanceFinancial ManagementCorporate ManagementCorporate Planning It keeps tract of the firm s performance conduct their own evaluations of the company s business activities Investment analystsBoard of DirectorsExternal AuditorsCredit analystsIt examines a firm s financial strengthfor its debt holders Credit analystsBoard of DirectorsInvestment analystsExternal Auditors The basic objective of the investment financing and dividend decisions is to maximize theFirm s wealthThe current value per share of the existing stocksBusiness ProfitManagers compensation and benefits The following are responsibility areasin achieving the financial objectives of a firm exceptDividend This study source was downloaded by 100000872171310 from CourseHero com on 09 20 2023 09 59 24 GMT 05 00 https www coursehero com file 80489735 Prelim Examdocx Operating FinancingInvesting Which of the following statements is false The financing decision involves the process of allocating funds for investment in competing assetsThe treasurer would be responsible for activities such as managing cash balances granting credit to customers and managing the process of issuing new securities It is necessary to determine the appropriate risk return trade off to maximize the market value of the firm for its shareholders The optimal capital structure is the best combination of long term debt and equity Statement 1 The Controller or Chief Accounting Officer is responsible for the maintenance of adequate internal control and for the preparation of accounting records and financial statementsStatement 2 The Treasurer has custody of the company funds and is generally responsible for planning and controlling the company cash positionTrue TrueTrue FalseFalse FalseFalse True Statement 1 The raising of more debts will involve fixed interest liability and dependence upon outsiders It may help in increasing the return on equity but will also enhance the risk Statement 2 The raising of funds through equity will bring permanent funds to the business but the shareholders will expect higher rates of earnings True TrueTrue FalseFalse FalseFalse True Statement 1 Investment Decision is influenced by