Architectural Profit and Financial Management Quiz
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Questions and Answers

Which of the following is NOT a reason why a profit is required in a business?

  • To attract talent and partners
  • To secure bank loans
  • To build a successful financial history for borrowing funds
  • To distribute profits to shareholders (correct)

    • What is the purpose of setting aside a percentage of the profit as a capital reserve?

  • To pay out retiring or dismissed employees and partners
  • To attract investors
  • To have funds for lean years (correct)
  • To maximize profit

    • What does financial management help a firm to do?

  • Maximize profit (correct)
  • Attract talent and partners
  • Distribute profits to shareholders
  • Secure bank loans

    • Which factors are considered in a performance review for the distribution of incentive bonuses?

    <p>Ability, productivity, and behavior</p> Signup and view all the answers

    What should the additional percentage for shareholders or partners' investment represent?

    <p>A reasonable return for their financial risk</p> Signup and view all the answers

    Where can you find information about performance reviews?

    <p>Chapter 3.6 - Human Resources</p> Signup and view all the answers

    Which of the following is a key component of a financial plan for an architectural practice?

    <p>Revenue projections</p> Signup and view all the answers

    What is the purpose of short-term financial planning, also known as budgeting?

    <p>To monitor monthly income and expenses</p> Signup and view all the answers

    Why is it important for an architectural practice to have a financial plan in case of downsizing?

    <p>To resolve issues like lease relief and restructuring</p> Signup and view all the answers

    Which of the following is included in projected income?

    <p>Actual professional income</p> Signup and view all the answers

    What should be considered when adjusting projected income?

    <p>Current and projected economy</p> Signup and view all the answers

    How are profits usually estimated in relation to projected revenues?

    <p>As a percentage</p> Signup and view all the answers

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