CPFM Strategic Financial Planning 2

Question 1

A firm wants to align its capital allocation with its long-term mission rather than short-term earnings. Which planning approach best supports this?

Accepted Answer

Strategic financial planning tied to corporate strategy

Answer

Monthly variance reporting

Answer

Petty cash reconciliation

Answer

Daily cash sweeps

Question 2

Which document translates a company's strategic goals into multi-year financial projections?

Accepted Answer

A long-range financial plan

Answer

A purchase order

Answer

A bank reconciliation

Answer

An expense report

Question 3

When evaluating a strategic investment, which metric incorporates the time value of money?

Accepted Answer

Net present value (NPV)

Answer

Accounting payback period

Answer

Gross margin

Answer

Headcount ratio

Question 4

A strategic plan assumes 5% annual revenue growth, but a recession is possible. What technique tests the plan under different conditions?

Accepted Answer

Scenario analysis

Answer

Double-entry bookkeeping

Answer

Bank confirmation

Answer

Inventory counting

Question 5

Which of the following is the primary purpose of a SWOT analysis in strategic financial planning?

Accepted Answer

Identify strengths, weaknesses, opportunities, and threats

Answer

Calculate depreciation

Answer

Reconcile the general ledger

Answer

Process payroll

Question 6

A company's weighted average cost of capital (WACC) is used in strategic planning primarily to:

Accepted Answer

Set the hurdle rate for evaluating investments

Answer

Determine employee bonuses

Answer

Calculate sales tax

Answer

Schedule maintenance

Question 7

Which statement best describes the relationship between strategic planning and budgeting?

Accepted Answer

Budgeting allocates short-term resources to execute the strategic plan

Answer

Budgeting replaces strategic planning

Answer

They are unrelated processes

Answer

Budgeting precedes setting any strategy