Finance Questions

1. Corporations [LO3] What is the primary disadvantage of the corporate form of organization? Name at least two advantages of corporate organization.

2. Goal of the Firm [LO2] Evaluate the following statement: Managers should not focus on the current stock value because doing so will lead to an overemphasis on short-term profits at the expense of long-term profits.

3. What type of decisions would a company make that would increase profits yet endanger the long term interest of shareholder? What is the financial manager's role in this situation?

4. What is the DuPont ratio analysis?

5. The textbooks does a great job on illustrating the sources and use of cash and the components of the statement of cash flow. Statement has three sections which is cash from operating activity, investing activity and financing activity . Understanding the sources and use of cash by a company is important and is a concern of many investors. Why is it important? What would happen if all the cash was a result of investing activity? What does this mean?

6.What is the sale forecasting method to create proforma financial statements?

7.Commons Size Statements are used often in business. What are your thoughts on statements?

8. What is financial ratio analysis?

9.What is the definition of financial management?