The Financial Management Framework Focuses on Which Three Areas of Decision-Making

question 81

Multiple Choice

The financial management framework focuses on which three areas of decision-making?

• A)Operating,investing,and profitability.
• B)Profitability,financing,and investing.
• C)Investing,financing,and operating.
• D)Operating,financing,and profitability.

---

Definitions:

Retained Earnings

The portion of net earnings not paid out as dividends, but retained by the company to be reinvested in its core business or to pay debt.

Contractual Loan Restrictions

Stipulations within a loan agreement that limit certain actions of the borrower to protect the interests of the lender.

Preferred Dividends

Preferred dividends are payments made to preferred shareholders before any dividends are paid to common shareholders, typically at a fixed rate.

Operating Expenses

Costs associated with the day-to-day functions of a business, excluding the cost of goods sold.