TMA Cheat Sheet 2026

The 30 highest-yield TMA facts, distilled from real exam questions. Print it, save it as a PDF, or study it here — free, no sign-up.

1. A turnaround professional is hired to assess a distressed manufacturer. Their FIRST priority should be: → Stabilizing cash flow and securing immediate liquidity
2. In financial restructuring, what does 'enterprise value' represent? → The total value of the business to all stakeholders, including debt and equity
3. What does DIP financing stand for in restructuring? → Debtor-In-Possession financing
4. Which of the following is the most accurate definition of 'insolvency'? → A company's inability to pay its debts as they come due
5. What does 'par' mean in the context of distressed debt trading? → The face value of the debt instrument at 100 cents on the dollar
6. What does 'leverage' mean in a corporate finance context? → The use of debt to amplify potential returns (and risks)
7. Which financial statement best reveals a company's short-term liquidity crisis? → Cash flow statement
8. The following are examples of vertical growth: -----. → Both Backward integration and Forward integration
9. When customers are able to eliminate middlemen like intermediaries, suppliers experience forward vertical integration. → TRUE
10. Which of the following scenarios most likely has a high buyer power? → Where switching costs are low
11. What does 'revenue enhancement' mean as a turnaround lever? → Taking actions to grow or protect revenue alongside cost reduction efforts
12. A company operating in a 'mature' industry phase is most likely to face: → Intense competition, margin compression, and slower growth
13. What is 'succession planning' important for in a crisis situation? → Ensuring continuity of leadership if key executives depart during the turnaround
14. What is a '100-day plan' in the context of a turnaround engagement? → A structured short-term action plan to achieve critical stabilization milestones
15. Research is conducted, and product marketing and advertising are coordinated by the ---- function. → Marketing
16. Why is IT systems stability important during an operational turnaround? → Operational disruptions from IT failures can accelerate financial losses
17. Which type of lender typically has the highest priority claim in a bankruptcy liquidation? → Secured senior lenders
18. A company's quick ratio is 0.6. What does this indicate? → The company may struggle to meet short-term obligations without selling inventory
19. Under which heading in the Exploring Strategy Model are environment, capability, goals, and culture covered? → Strategic position
20. What is a key performance indicator (KPI) dashboard used for in a turnaround? → Providing management real-time visibility into critical operational and financial metrics
21. Organizations can greatly benefit from strategies for ---- → All of these
22. What is 'force majeure' and how is it relevant in corporate crisis management? → A contract clause excusing performance due to extraordinary, unforeseeable events
23. What is 'accounts receivable days' (DSO) used to measure? → The average number of days it takes to collect payment from customers
24. A company's 'burn rate' refers to: → The monthly rate at which a company spends its cash reserves
25. What is 'hold-out' risk in a debt restructuring negotiation? → The risk that some creditors refuse to agree to the restructuring, disrupting the deal
26. What is a '13-week cash flow forecast' used for in turnaround management? → Monitoring near-term liquidity and cash runway during a crisis
27. The following are examples of vertical growth: -----. → All of these
28. What is the primary purpose of a 13-week cash flow forecast in a turnaround situation? → To provide a near-term, rolling view of liquidity and cash needs
29. What is a 'sensitivity analysis' in the context of restructuring valuation? → Testing how changes in key assumptions affect enterprise value and creditor recoveries
30. It is via business —— that novel concepts and inventive ideas are given expression and developed into beneficial goods and services. → Goals