check

Financial IQ Assessment

Take this quick assessment to gauge your understanding of business finance.

Click the button below to start.

Start

Question 1 of 15

Which financial statement provides information about a company's revenues, expenses, and net income? 

A

Balance sheet

B

Cash flow statement

C

Income statement

D

Statement of retained earnings

Question 2 of 15

Which financial statement provides information about capital expenditures? 

A

Income statement

B

Balance sheet

C

Cash flow statement

D

Statement of retained earnings

Question 3 of 15

The financial statement that reports a company's assets, liabilities, and equity is the: 

A

Balance sheet

B

Income statement

C

Cash flow statement

D

Statement of retained earnings

Question 4 of 15

What is the accounting formula? 

A

Assets = Liabilities - Equity

B

Assets + Equity = Liabilities

C

Asset + Liabilities = Equity

D

Assets = Liabilities + Equity

Question 5 of 15

Net income on the income statement is calculated as: 

A

Revenue minus expenses

B

Assets minus liabilities

C

Cash inflows minus cash outflows

D

Revenue minus cost of goods sold

Question 6 of 15

In finance, liquidity refers to: 

A

The ability of a company to generate profit from its assets

B

The total value of a company's assets

C

The extent to which a company's assets exceed its liabilities

D

The ability of a company to meet its short-term obligations

Question 7 of 15

The purpose of financial ratios is to: 

A

Evaluate a company's cash flows

B

Assess a company's liquidity, profitability, and financial stability

C

Calculate a company's return on investment

D

Determine a company's weighted average cost of capital

Question 8 of 15

The financial ratio that measures a company's ability to meet its short-term obligations is the: 

A

Debt-to-equity ratio

B

Current ratio

C

Gross profit margin

D

Return on assets

Question 9 of 15

Free cash flow is calculated as: 

A

Operating cash flow minus capital expeditures

B

Net income plus depreciation and amortization

C

Operating cash flow plus financing cash flow

D

Earnings before interest and taxes (EBIT) minus taxes

Question 10 of 15

 

What does a positive NPV indicate? 

A

The investment will generate more cash inflows than outflows

B

The investment will not yield any returns

C

The investment has high risk and uncertainty

D

The investment is not financially viable

Question 11 of 15

Capital budgeting is the process of: 

A

Assessing a company's financial performance over time

B

Calculating a company's net present value (NPV)

C

Evaluating investment opportunities and making decisions about long-term projects

D

Determining a company's cost of capital

Question 12 of 15

 

How is intrinsic value calculated for a stock? 

A

By analyzing the historical performance of the stock

B

By assessing the company's brand reputation and customer loyalty

C

By discounting the projected future cash flows of the stock

D

By multiplying its P/E ratio by its market capitalization

Question 13 of 15

How does expansionary monetary policy impact the economy? 

A

Increases interest rates

B

Reduces government spending

C

Encourages borrowing and spending

D

Decreases money supply

Question 14 of 15

Return on investment (ROI) is calculated as: 

A

Net income divided by the cost of investment

B

Cash inflows divided by the cost of investment

C

Gross margin divided by the equity portion of an investment

D

EBITDA divided by the equity portion of an investment

Question 15 of 15

How can we best support you and your goals?

Confirm and Submit