1. Today 2/26/2016 ABC Sport company sells 1500 shoes to a customer on credit (30 day credit term) for a total of $20,000, how will this trade activity affect ABC company's cash flow (Operating Activities) for the month of Feb, 2016 and Mar, 2016 when $20,000 is paid?
2. Discuss the difference between cash flow and profit in the world of finance. Which one do you think is more important, and why?
3. In the context of agency problems, what conflicts of interest can arise between managers and stockholders?
4. Why is ethical behavior so important in the field of finance?
5. Does the goal of shareholder wealth maximization conflict with behaving ethically? Explain.
6. Describe how financial institutions and markets facilitate the expansion of a company's business.
7. List and describe the four major financial statements.
8. How does the choice of accounting method used to record fixed asset depreciation affect management of the balance sheet?