25. Planning for future growth is called:
A. Capital Budgeting
B. Financial forecasting
C. Working Capital Management
D. Financial management

26. The percent of sales method of financial forecasting shows us the relationship between ___________ and financing needs.
A. changes in the level of assets
B. changes in debt
C. changes in the level of liabilities
D. changes in the level of sale

27. Using the expectations hypothesis theory for the term structure of interest rates, determine the expected return for securities with maturities of two, three, and four years based on the following data. Do an analysis similar to that in the right-hand portion of Table 6-6.

1-year T-bill at beginning of year 1 6%
1-year T-bill at beginning of year 2 7%
1-year T-bill at beginning of year 3 9%
1-year T-bill at beginning of year 4 11%

A. 2 yr (5.0%), 3 yr (7.58%), 4 yr (8.25%)
B. 2 yr 8.25%), 3 yr (7.33%), 4 yr (6.5%)
C. 2 yr (6.5%), 3 yr (7.33%), 4 yr (8.25%)
D. 2 yr (6.5%), 3 yr (8.25%), 4 yr (7.33%)

28. Cats Copier, Inc. shows the following values on its corporate books.

Corporate Books

Initial amount .......................$10,000
Deposit ..............................+100,000
Checks .............................. - 45,000
Balance .............................$ 65,000

The initial amount on the bank's books is $20,000. Only $85,000 in deposits have been recorded and only $18,000 in checks have cleared. What is the actual balance per the bank books?

A. $87,000
B. $65,000
C. $22,000
D. $18,000

29. If a firm uses a just-in-time inventory system, what effect is that likely to have on the number and location of suppliers?
A. They will have more suppliers
B. They will have fewer suppliers
C. Suppliers will stay the same
D. They don't need suppliers anymore

30. Best Co. has an average collection period of 35 days. The accounts receivable balance is $105,000. What is the value of credit sales?
A. $1,200,000
B. $1,300,000
C. $1,080,000
D. $1,280,000

31. Electronic funds transfer has __________ the use of float.
A. Reduced
B. Increased
C. Had no effect on
D. None of the above

32. Of the following marketable securities, which are guaranteed by the Federal government?
A. agency securities
B. negotiable certificates of deposit
C. banker's acceptances
D. none of the above