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CSS Business Administration Financial Management Flashcards
58 question-and-answer cards covering Financial Management as it is examined in CSS Business Administration. 24 of them are printed below, taken from across the deck — no signup, no paywall on the preview.
24 sample cards from the Financial Management deck
Sampled from the end of the deck, so these are different cards from the ones shown on the syllabus page.
What is a derivative security?
A financial instrument whose value is derived from the value of an underlying asset, index, or rate, such as futures, forwards, options, and swaps.
Define the time value of money.
The principle that a sum of money available today is worth more than the same sum in the future because of its potential earning capacity (it can be invested to earn a return).
What is the future value formula for a single sum under annual compounding?
FV = PV x (1 + i)^n, where PV is present value, i is the interest rate per period, and n is the number of periods.
What is the present value formula for a single future sum?
PV = FV / (1 + i)^n, where FV is the future value, i is the discount rate per period, and n is the number of periods.
What is the difference between compounding and discounting?
Compounding moves a present value forward in time to find a future value (multiplying by (1+i)^n); discounting brings a future value back to the present (dividing by (1+i)^n).
What is an annuity?
A series of equal cash flows (payments or receipts) occurring at regular, equal intervals over a specified period of time.
Distinguish an ordinary annuity from an annuity due.
In an ordinary annuity, payments occur at the end of each period; in an annuity due, payments occur at the beginning of each period, so an annuity due is worth more (one extra period of compounding).
What is the present value formula for an ordinary annuity?
PV = A x [1 - (1 + i)^-n] / i, where A is the periodic payment, i is the interest rate per period, and n is the number of periods.
What is the future value formula for an ordinary annuity?
FV = A x [(1 + i)^n - 1] / i, where A is the periodic payment, i is the rate per period, and n is the number of periods.
What is a perpetuity and what is its present value formula?
A perpetuity is an annuity that continues forever (infinite equal cash flows). Its present value is PV = A / i, where A is the periodic payment and i is the discount rate per period.
What is the present value of a growing perpetuity?
PV = A / (i - g), where A is the first period's cash flow, i is the discount rate, and g is the constant growth rate of the cash flows (valid when i > g).
What is loan amortization?
The process of repaying a loan through equal periodic payments, where each payment covers the interest due plus a portion of the principal, so the loan balance reduces to zero by maturity.
In an amortizing loan, how do the interest and principal portions of each payment change over time?
The interest portion declines and the principal repayment portion increases over the life of the loan, while the total payment stays constant (because interest is charged on a shrinking balance).
How is the equal periodic payment on an amortized loan calculated?
Payment = Principal / [annuity present value factor] = P x i / [1 - (1 + i)^-n]; that is, the loan principal is divided by the present value annuity factor for the rate i and n periods.
How does more frequent compounding affect the future value and effective rate?
The more frequently interest is compounded within a year, the greater the future value and the higher the effective annual rate, because interest is earned on interest more often.
What is the formula for the effective annual rate (EAR) given a nominal rate?
EAR = (1 + i/m)^m - 1, where i is the nominal annual rate and m is the number of compounding periods per year.
What is the future value formula with compounding m times per year?
FV = PV x (1 + i/m)^(m x n), where i is the nominal annual rate, m is the number of compounding periods per year, and n is the number of years.
What is the formula for continuous compounding?
FV = PV x e^(i x n), where e is the exponential constant (approximately 2.71828), i is the annual rate, and n is the number of years.
What are the four primary financial statements?
The balance sheet (statement of financial position), the income statement (profit and loss account), the statement of cash flows, and the statement of changes in owners' equity.
What does the balance sheet show and what is its fundamental equation?
It shows a firm's financial position at a point in time. Its equation is: Assets = Liabilities + Owners' Equity.
What does the income statement report?
It reports a firm's revenues, expenses, and resulting net profit or loss over a period of time, summarizing operating performance (Revenues - Expenses = Net Income).
What are the three sections of the statement of cash flows?
Cash flows from operating activities, cash flows from investing activities, and cash flows from financing activities.
What is working capital and how is net working capital calculated?
Working capital is the funds available for day-to-day operations. Net working capital = Current Assets - Current Liabilities.
What is the difference between gross profit, operating profit, and net profit on an income statement?
Gross profit = Sales - Cost of Goods Sold; Operating profit (EBIT) = Gross profit - Operating expenses; Net profit = Operating profit - Interest - Taxes.
What this deck covers
The Financial Management deck follows the CSS Business Administration Financial Management syllabus — 6 chapters and 22 topics — so questions land on material that is genuinely examinable rather than trivia around it. That works out to roughly 9.7 cards per chapter.
Answers are written to be recallable, not just readable — averaging about 151 characters, which is long enough to carry the reasoning and short enough to say out loud.
A deck like this earns its keep on the second and third pass. Read the syllabus first so you know the shape of the subject, then use the cards to find the specific facts that have not stuck.
Financial Management flashcards FAQ
How many Financial Management flashcards are in this CSS Business Administration deck?
58 cards. This page previews 24 of them, sampled evenly across the deck so you can judge the difficulty before installing anything.
Are these CSS Business Administration flashcards free?
Yes. The preview here is free to read with no signup, and the full 58-card deck is free inside the Examius app.
What do the Financial Management cards cover?
They follow the CSS Business Administration Financial Management syllabus — 6 chapters and 22 topics — so the questions track what is actually examinable.
How should I use these flashcards?
Read the syllabus first so you know the shape of the subject, then drill the deck. Examius schedules each card with spaced repetition, so cards you keep missing come back sooner and ones you know drift further apart.