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Bellevue University MBA 620 MBA 620 Cash Management Quiz Quiz 1 Chapter 1 1)The board of directors has the responsibility to act in the best interests of shareholders

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Bellevue University

MBA 620

MBA 620 Cash Management Quiz

Quiz 1 Chapter 1

1)The board of directors has the responsibility to act in the best interests of shareholders. In the United States, this is generally interpreted as:

a.            Maximize expected total corporate profit.

b.            Maximize expected EPS.

c.             Minimize the chances of losses.

d.            Maximize the total stock value, i.e. owners’ wealth.

e.            Maximize expected net income.

2.            All of the following are common factors in the determination of the number of bank relationships, except

a.            existence of multi-country operations

b.            cost of maintaining multiple relationships

c.             concentration risk d. sovereign risk

e. all of the above, i.e. all of these are common factors in the determination of bank relationships

3.            The authorization empowering a representative of the business to enter into agreements for financial services is a        and usually made at the                level.

a.            account resolution; CEO

b.            account resolution; Board of Directors

c.             certificate of banking; CEO

d.            certificate of banking; Board of Directors

e.            none of the above options is correct

4.            Federal legislation that makes the CFO of a publicly traded company listed on a US stock exchange personally responsible for the accuracy and completeness of financial statements is the:

a.            Improve Disclosure Act (IDA) b. Sarbanes-Oxley (SOX) Act

c.             Glass-Steagall Act (GSA)

d.            Gramm-Leach-Bliley (GLB) Act

e.            Investor Protection Act (IPA)

5.            A treasurer is primarily responsible for the following, except.

a.            managing financial risk

b.            overseeing day-to-day liquidity

c.             investing for the short and long term

d.            developing treasury policies

e.            setting corporate credit policies

6.            To protect shareholders,              establishes a set of checks and balances to place limits on executive prerogatives and to monitor management performance.

a.            corporate governance

b.            investment policies

 

c.             investment objectives

d.            treasury objectives

e.            counterparty balances

7.            A consolidated operation that supports standardized finance processes and controls within an organization is known as

a.            concentration office (CO)

b.            consolidation service office (CSO)

c.             office of standardized processes (OSP) d. shared service center (SSC)

e. none of the above are terms associated with this concept

8.            An average collected balance may be used to compensate a bank for service used. Assume a company uses services with charges that total $2,000, that the bank's earning credit rate is 5%, and that the reserve requirement is 10%. Assuming a 30 day month, what is the average collected balance required to compensate the bank for the services used?

a. 540,741

b. 901,235

c.             44,444

d. 486,667

e. insufficient information to compute

9.            In the United States, a report a bank provides to commercial customers specifying services provided, volumes processed, and charges assessed is typically known as a (an)

a.   bank statement b. account analysis

c.             TMA statement

d.            ACH statement

e.            repo

10.          All of the following factors are important to increase the mutual benefits and effectiveness/efficiency (success) of relationships EXCEPT

a.            frequent communication

b.            regular and timely feedback

c.             documented expectations of both parties

d.            complete and timely disclosure

e.            asymmetric (i.e. not symmetrical = not equal) information