Which of the following statements is not true regarding the goal of financial management? The goal of maximizing the value per share of existing stock Is relevant to all organizations. A way of aligning management goals to shareholder’s interest is to tie managerial compensation to the market value of the firm’s stock. For a company considering international operations, the goal will be the same but the company will have to consider the local social, economical and political environment in the decision-making process.
All of the above are true. 2. Market value Is Important to the financial manager because: It reflects the value of the asset based on generally-accepted accounting principles. Is a crucial component of the balance sheet and can impact the financial statements. Market values reflect the amount someone is willing to pay today for an asset. The market value of an asset reflects its historical cost. 3. For this question, use the Information for Sports Baseballs, Inc. Sports Baseballs, Inc.
For this exercise you will be choosing more than one option for your answer: Identify three good investment opportunities for the firm. Obtain a short-term loan to purchase materials. Evaluate the level of risk of a project. Sale long-term bonds to raise funds. Determine the return of a potential project. 7. Match the following terms with the examples as appropriate Matching: Answer I I Potential Matches: I : Insider trading I 1: McDonald’s work to redesign packaging items with recyclable materials. : Microsoft’s monopolistic behavior. 3: Martha Steward’s sale of Leone stock as result of information provided by the company’s CEO before an announcement was made public that significantly decrease loneness stock price. 4: Parallax’s deliberate fraudulent accounting practices. 5: established an oversight board responsible for improving auditing standards within companies.
