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《财务管理基础》期中测验(A) CLASS______NAME__________NUMBER_________SCORE________ I True / False Questions（each 1.5,total 30） 1.?Asset utilization ratios can be used to measure the effectiveness of a firms managers.?(T) 2.?Fiercely competitive industries such as the computer industry have had lower profit margins and return on equity in recent years even though they are under extreme pressure to maintain high profitability.?(T) 3.?Ratios are not distorted by inflation.?(F) 4.?Profitability ratios are distorted by inflation because profits are stated in current dollars and assets and equity are stated in historical dollars.?(T) 5.?FIFO will cause inflated profits during deflation.?(F) 6.?Leverage is the use of fixed costs to magnify returns at high levels of operation.?(T) 7.?Leverage works best when volume is increasing.?(T) 8.?Operating leverage emphasizes the impact of using fixed assets in the business.?(T) 9.?Financial leverage emphasizes the impact of using debt in the business.?(T) 10.?Operating leverage determines how income from operations is to be divided between debt holders and stockholders.(F)?11.?Pro forma income statements and balance sheets refer to projected financial statements.?(T) 12.?The generation of sales and profits ensures that there will be adequate cash on hand to meet financial obligations as they come due.?(F) 13.?Sales projections and the ability to accurately predict the future have a large impact on cash flow targets.?(T) 14.?Production planning depends upon the beginning and ending accounts receivable levels, as well as the projected monthly sales level.?(F) 15.?If Product Corp has beginning inventory of 100 units, projected sales of 400 units, and desired ending inventory of 200 units, production must be planned for 300 units.?(F) 16.?Managers who are risk averse and uncertain about the future would most likely minimize combined leverage.?(T) 17.?Management should tailor the use of leverage to meet its own risk-taking desires.?(T) 18.?Cash brea