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WGU C214 – Financial Management OA Exam Questions and Verified Answers (2025/2026)

HEAL100 Health Care — exam and revision material · Other

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Health Care exam material, 25 pages. Originally published on StudyMerit.

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25
Academic year
2025/2026
Language
English

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WGU C214 OA Financial Management Exam Pass Questions and Answers Updated (202 5 /202 6 ) (Verified Answers) Characteristics of preferred stock includes - correct answer - -dividends in arrears -dividends are cumulative -higher payoff claim in a BK (has first dibs in a BK) -considered "hybrid" (part stock/part bond) -no fixed maturity date -no voting rights -can skip dividend payments -dividends don't change year-after-year -used in start ups (IPO) Preferred stock dividends - correct answer - can go without payment and pay in arrears the following year Characteristics of common stock are - correct answer - -voting rights -no maturity date -corporate governance -lower payoff claim in BK -variable returns -unlimited earnings potential -earnings are in dividends & the increase in price of stock

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New start up ventures often issue - correct answer - preferred stock (in an IPO) What stock is considered a hybrid - correct answer - preferred stock One thing common stock and preferred stock have in common is - correct answer - both have no maturity date Which type of security has voting rights - correct answer - common stock Debt covenants and restrictions help to ensure that - correct answer - management is meeting bond and shareholder expectations NOTE: covenants are promises meant to be kept What is true regarding bonds - correct answer - -when bond matures, bondholder gets lump sum back -coupon rate doesn't change -maturity is in years -PAR value is typically $1000 -Future value (same as PAR) is typically $1000 Bond sells at face value when - correct answer - required rate of return is equal to the coupon rate

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Why are bonds the primary method for raising capital - correct answer - because bonds remove the intermediary costs NOTE: IPO's require an intermediary known as a syndicate - a group of banks underwriting the security issue What type of bond can be traded for stock - correct answer - convertible bonds What is the interest rate for annual payments of a bond known as - correct answer - the coupon rate NOTE: coupon rate is the established interest rate for the life of the bond and will remain unchanged Coupon rate is the established rate of the bond and should - correct answer - never change Debentures are - correct answer - secured bonds NOTE: debentures are a debt instrument (bond) issued to raise cash, secured against a company's assets and backed by credit, transferable by the holder, and may also be unsecured Secured loan - correct answer - has collateral like a mortgage The amount repaid at the expiration date of a bond is

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