Finance For Non-Finance

Category 1

100

How is the WCR calculated?

• Accounts payable + Accounts receivable
• Inventory - Purchases
• Inventory + accounts receivable -accounts payable
• Accounts payable - inventory + accounts receivable
• Accounts receivable – inventory

Inventory + accounts receivable - accounts payable

200

A reduction of the interest rate on the debt…

• decreases the value of the business.
• has no effect on the value of the business.
• increases the value of the business.
• increases the cost of money.
• decreases the cost of money.

• increases the value of the business.
• decreases the cost of money.

300

Which of the below-mentioned situation is threatens the financial balance of the company?

• The company takes too much debt
• The company liquidity is low due to declining profitability
• The company has low liquidity due to financial expenses

All of the them

400

Which of the following is not a part of the financial pump in the organization?

• Liquidity
• Financial Equilibrium
• Profitability
• Business

Business

500

State true or false 

The income statement is the financial statement showing the transaction that increases or decreases the value of the company over a period of time.

True

Category 2

100

What is the indicator that allows us to measure economic profitability?

• ROCE (Return on Capital Employed)
• Trading margin
• ROE (Return on Equity)
• Net income
• Operating profit

ROCE (Return on Capital Employed)

200

Granting a discount for cash payments means…

• favouring profitability over liquidity.
• favouring liquidity over profitability.
• favouring financial equilibrium over liquidity.
• favouring financial equilibrium over profitability.
• choosing between the 3 keys.

• favouring liquidity over profitability.
• choosing between the 3 keys.

300

What are the different types of assets captures in the balance sheet?

• Fixed assets and current assets
• Tangible assets and inventories
• Long-term assets and accounts receivable

All of them

400

Which of the following will give you information on the liquidity in the organization?

• The Balance Sheet
• The Income Statement
• The Cash Flow Statement
• All of the above

The Cash Flow Statement

500

What are the keys of financial performance?

• Finance equilibrium
• Income
• Profitability
• GOP
• Liquidity

• Finance equilibrium
• Profitability
• Liquidity

Category 3

100

What is the indicator that allows us to measure financial profitability?

• ROCE (Return on Capital Employed)
• Trading margin
• ROE (Return on Equity)
• Net income
• Financial profit

ROE (Return on Equity)

200

What is shown by the cash flow statement?

• Profitability
• Profits and losses for the period
• Net income for the period
• Cash inflows and outflows
• The cash generated by the business

• Cash inflows and outflows
• The cash generated by the business

300

Which of the following do not affect the financial equilibrium: 

Modifying the way you extend credit to clients

renegotiating payment terms granted by your supplier

changing prices

All of them

400

Purchase of a machine for enhancing the manufacturing capacity is an example of ___

• Disbursement
• Fixed asset
• Receipt
• All of the above

Fixed asset

500

State true or false

Receipts and disbursements are recorded in the income statement.

False 

Category 4

100

The capital employed is calculated by adding:

• equity and debt.
• fixed assets and inventory.
• fixed assets and WCR.
• inventory and accounts receivable.
• accounts receivable and accounts payable.

fixed assets and WCR

200

What is the WCR?

• A working capital requirement linked to the time lag between receipts and disbursements.
• A working capital requirement linked to a company loss.
• A financial resources requirement.
• A working capital requirement linked to the operating cycle.
• A financial document.

• A working capital requirement linked to the time lag between receipts and disbursements.
• A working capital requirement linked to a company loss.

300

Granting payment extensions to customers has an impact on…

• financial equilibrium.
• WCR.
• liquidity.
• profitability.
• Equity

• financial equilibrium.
• WCR.
• liquidity.

400

Operating Profit = Sales – Production cost of products sold - _____ - Administrative cost – R&D costs

• Selling cost
• Fixed cost
• Operating cost
• Raw Material cost

Selling cost

500

A negative WCR is…

• a resource.
• a requirement that has to be financed by the operating cycle.
• an inevitable consequence of the company’s business activity.
• common in some sectors, such as retail chains.
• more desirable than a positive WCR, in terms of cash flow.

• a resource.
• common in some sectors, such as retail chains.
• more desirable than a positive WCR, in terms of cash flow.

Category 5

100

What is shown by the balance sheet?

• The composition of assets and liabilities
• Net income
• Financial equilibrium
• Profits and losses for the period
• Profitability

• The composition of assets and liabilities
• Financial equilibrium

200

EVA is an indicator that allows us to measure…

• value creation.
• the income surplus resulting from the activity, compared to the financing cost.
• cash flows.
• revenue.
• expenses.

• value creation.
• the income surplus resulting from the activity, compared to the financing cost.

300

As a non-finance manager, you can create value by…

• developing sales.
• negotiating payment deadlines with your suppliers.
• reducing your customers’ payment deadlines.
• changing the cost of your debt.
• playing on your company’s taxation.

• developing sales.
• negotiating payment deadlines with your suppliers.
• reducing your customers’ payment deadlines.

400

What is the formula for operating margin?

• Operating cost/sales
• Sales/operating cost
• Profit/fixed assets
• Fixed assets – sales/net income

Operating cost/sales

500

What is the WACC?

• The average cost of equity.
• The weighted average cost of capital.
• The average of the cost of your debt and the cost of your equity.
• The cost of your debt.
• A purely financial concept.

• The weighted average cost of capital.
• The average of the cost of your debt and the cost of your equity.