Business Certifications Business Certifications Financial Management & Budgeting 2

Question 1

What does EBITDA stand for?

Accepted Answer

Earnings Before Interest, Taxes, Depreciation, and Amortization

Answer

EBITDA stands for Earnings Before Interest, Taxes, Depreciation, and Amortization, and is commonly used to evaluate core operating performance.

Question 2

In financial forecasting, a "rolling forecast" means:

Accepted Answer

A forecast that is continuously updated to cover a fixed future horizon

Answer

A rolling forecast is continuously updated to maintain a fixed forward-looking horizon (e.g., 12 months ahead) as each period passes.

Question 3

Accounts payable in financial management refers to:

Accepted Answer

Money the company owes to its suppliers for goods or services received

Answer

Accounts payable represents amounts a company owes to its suppliers for goods or services it has received but not yet paid for.

Question 4

A company's gross profit is calculated as:

Accepted Answer

Revenue minus cost of goods sold (COGS)

Answer

Gross profit equals revenue minus the cost of goods sold (COGS), before subtracting operating expenses such as salaries or rent.

Question 5

What is the primary purpose of a financial audit?

Accepted Answer

To provide an independent assessment of financial statement accuracy

Answer

A financial audit provides an independent, objective examination of an organization's financial statements to ensure they are accurate and compliant with accounting standards.

Business Certifications Practice Test

Business Certifications Practice Test

Business Certifications Business Certifications Financial Management & Budgeting 2