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NAT – IIM Management (Management Sciences Group)

NAT-IIM Test is for Students Who have Completed their 14 Years Education in Management Sciences and are looking for affirmation in College/University for Masters Degree

 

Management Sample Questions

31. “Shareholder wealth” in a firm is represented by:
a) The number of people employed in the firm.
b) The book value of the firm’s assets less the book value of its liabilities.
c) The amount of salary paid to its employees.
d) The market price per share of the firm’s common stock.

32. The long-run objective of financial management is to:
a) Maximize earnings per share.
b) Maximize the value of the firm’s common stock.
c) Maximize return on investment.
d) Maximize market share.

33. What are the earnings per share (EPS) for a company that earned $100,000 last
year in after-tax profits, has 200,000 common shares outstanding and $1.2 million in
retained earning at the year end?
a) $100,000
b) $6.00
c) $0.50
d) $6.50

34. A(n) would be an example of a principal, while a(n) ______ would be an example
of an agent.
a) Shareholder; manager
b) Manager; owner
c) Accountant; bondholder
d) Shareholder; bondholder

35. The market price of a share of common stock is determined by:
a) The board of directors of the firm.
b) The stock exchange on which the stock is listed.
c) The president of the company.
d) Individuals buying and selling the stock

Answers

(31) The market price per share of the firm’s common stock.
(32) Maximize the value of the firm’s common stock.
(33) $0.50
(34) Shareholder; manager
(35) Individuals buying and selling the stock.

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36. The focal point of financial management in a firm is:
a) The number and types of products or services provided by the firm.
b) The minimization of the amount of taxes paid by the firm.
c) The creation of value for shareholders.
d) The dollars profits earned by the firm.

37. The decision function of financial management can be broken down into the
______ decisions.
a) Financing and investment
b) Investment, financing, and asset management
c) Financing and dividend
d) Capital budgeting, cash management, and credit management

38. The controller’s responsibilities are primarily _______ in nature, while the
treasurer’s responsibilities are primarily related to .
a) Operational; financial management
b) Financial management; accounting
c) Accounting; financial management
d) Financial management; operations

39. In the US, the has been given the power to adopt auditing, quality control,
ethics, and disclosure standards for public companies and their auditors as well as
investigate and discipline those involved.
a) American Institute of Certified Public Accountants (AICPA)
b) Financial Accounting Standards Board (FASB)
c) Public Company Accounting Oversight Board (PCAOB)
d) Securities and Exchange Commission (SEC)

40. A company’s ————- is (are) potentially the most effective instrument of good
corporate governance.
a) Common stock shareholders
b) Board of directors
c) Top executive officers
d) None of these.

Answers

(36) The creation of value for shareholders.
(37) Investment, financing, and asset management
(38) Accounting; financial management
(39) Public Company Accounting Oversight Board (PCAOB)
(40) Board of directors

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