Which of the following is true of the investment function of finance??
A. ?Investment function determines the most socially responsible behavior of the corporations
B. ?Investment function determines the values, risks, and returns associated with financial assets as stocks and bonds.
C. ?Investment function determines the optimal mix of securities based on the environment friendly behavior of the corporations.
D. ?Investment function determines the regulations applicable to a public corporation.
E. ?Investment function determines additional information about the procedures used to construct and report financial statements.
Answer: B
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Which of the following circumstances most likely would cause an auditor to believe that material misstatements may exist in an entity's financial statements?
A. The chief financial officer does not sign the management representation letter until the last day of the auditor's fieldwork. B. Management consults with other accountants about significant accounting matters. C. Audit trails of computer-generated transactions exist only for a short time. D. Accounts receivable confirmation requests yield significantly fewer responses than expected.
A ________ is simply a set of names, addresses, and telephone numbers
A) customer database B) customer mailing list C) customer-performance scorecard D) customer profitability analysis E) customer-value hierarchy
Which of the following situations suggests the acceptance of an investment proposal?
A) The present value of the net cash inflows exceeds the initial investment. B) The IRR is lower than the hurdle rate. C) The cash inflows are less than the initial investment. D) The investment will have a residual value.
The margin of safety is computed by dividing 1 by the degree of operating leverage
Indicate whether the statement is true or false