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Financial Management 13

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Financial Management Multiple Choice Multiple Answer Question Limitations of cash flow analysis are Correct Answer It cannot be equated with the income statement , Cannot replace the fund flow statement , Dose not represent real liquid position Your Answer It cannot be equated with the income statement , Cannot replace the fund flow statement Select The Blank Question A list of all the material required for a job, process or production order is termed as ________. Correct Answer Bill of materials Your Answer Bill of materials

Select The Blank Question ________ in liabilities involves outflow of funds Correct Answer Decrease Your Answer True/False Question Increase

Income tax paid in the case of sole proprietor firms should be treated as a personal expense of the proprietor Correct Answer True Your Answer True

Multiple Choice Multiple Answer Question The internal factors affecting the dividend policy are Correct Answer Growth rate of the company , Composition of the shareholding Your Answer Growth rate of the company , Composition of the shareholding

Multiple Choice Multiple Answer Question The assumptions for the theories of capital structure are Correct Answer Firm use only long term debt capital or equity share capital Firm follow policy of paying 100% of its earnings by way of Operating earnings are not expected to grow Your Answer Firm use only long term debt capital or equity share capital Firm follow policy of paying 100% of its earnings by way of Multiple Choice Single Answer Question Credit period is Correct Answer the time allowed by the company to the customers to pay their dues Your Answer the time allowed by the company to the customers to pay their dues to raise funds , dividend , to raise funds , dividend

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Multiple Choice Multiple Answer Question Advantages of letter of credit to the Importer Correct Answer the importer can bargain for better trading terms , he is assured to get proper supply of the goods Your Answer the importer can bargain for better trading terms , he is assured to get proper supply of the goods Multiple Choice Single Answer Question From company's point of view return paid on own capital is Correct Answer is not a tax deductible expenditure Your Answer calculated from Profit before tax

Multiple Choice Multiple Answer Question The advantages of operating lease is Correct Answer In an operating lease arrangement the equipment risk is transferred to the lessor , It minimizes investment in equipment , Reduces expenditure on maintenance Your Answer In an operating lease arrangement the equipment risk is transferred to the lessor , It minimizes investment in equipment True/False Question One of the basic objectives of cash management is to maintain the optimum cash balance Correct Answer True Your Answer True

Multiple Choice Single Answer Question The Proprietary concern is owned by Correct Answer Only one person Your Answer Minimum 50 persons

Multiple Choice Single Answer Question How many days in a year are to be considered for the calculation of daily sales Correct Answer 360 Your Answer True/False Question 365

If the process of capital rationing is strictly followed it may result into the exclusion of various smaller projects by larger projects Correct Answer True Your Answer True

Select The Blank

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Question ________ in assets involves inflow of funds Correct Answer Decrease Your Answer Increase

Multiple Choice Multiple Answer Question The depreciation is being charged for the following assets Correct Answer Plant and Machinery , Building Your Answer True/False Question Plant and Machinery , Building , Land

Current ratio and Acid test ratio are categorised under liquidity group

Correct Answer True Your Answer True

Multiple Choice Single Answer Question The weighted average cost of capital is referred to as Correct Answer Average cost Your Answer Component cost

Select The Blank Question Break even point is that level of sales revenue at which there is ________ Correct Answer no profit no loss Your Answer no profit no loss

Multiple Choice Single Answer Question The amount of cheques issued by the company awaiting payment by the bank is called as Correct Answer Payment float Your Answer Postal float

True/False Question

Operating leverage is calculated as Earnings Before Interest and Tax / ( Earnings before Interest and Tax - Interest ) Correct Answer False Your Answer True

Multiple Choice Single Answer Question The ratio which indicates the protection available to the lenders of long term capital in the form of funds available to pay the interest charges is

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Correct Answer Interest coverage ratio Your Answer Debt Service coverage ratio

Match The Following Question Operating Profit Fixed cost Variable cost Contribution

Correct Answer Contribution less Fixed Operating cost remains constant varies in direct proportion to the sales revenue Sales less variable operating cost

Your Answer Contribution less Fixed Operating cost remains constant varies in direct proportion to the sales revenue Sales less variable operating cost

Select The Blank Question The economical use of the asset is permitted by the lessor on the payment of periodical amount which is in the form of ________. Correct Answer Lease rent Your Answer Lease rent

Multiple Choice Single Answer Question The most reliable source of getting the information about the creditworthiness of the customer who is dealing with the company presently is Correct Answer Past experience of the customer Your Answer Bank Reference

Select The Blank Question A liquid ratio of ________ is supposed to be standard Correct Answer 1 : 1 Your Answer 1:1

True/False Question

Liquid liabilities includes all current liabilities except bills payable

Correct Answer False Your Answer True

Multiple Choice Single Answer Question The financing of the working capital requirement which arises during the course of normal business operations is termed as Correct Answer Spontaneous sources

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Your Answer Spontaneous sources

Multiple Choice Multiple Answer Question Undue increase in Gross Profit ratio may indicate Correct Answer Consideration of non-sales transactions as sales transaction , Over-valuation of closing stock Your Answer Under-valuation of closing stock , Consideration of non-sales transactions as sales transaction Multiple Choice Multiple Answer Question The recommendations of the Chhore committee included Correct Answer increasing role of short term loans and bill finance and curbing the role of cash credit limits , the bank should appraise and fix separate limits for normal non-peak levels and also peak levels Your Answer increasing role of short term loans and bill finance and curbing the role of cash credit limits , the bank should appraise and fix separate limits for normal non-peak levels and also peak levels True/False Question

In Regular Stock Dividend policy, the company may pay dividend in the form of bonus shares instead of cash Correct Answer True Your Answer True

Multiple Choice Multiple Answer Question Advantages of Debentures from company's point of view are Correct Answer The specific cost of debt capital represented by debentures is lower than the cost of preference or equity capital , Debenture financing does not result in dilution of control Your Answer Debenture financing does not result in dilution of control , Carry voting rights Select The Blank Question The projects having Profitability index of more than ________ will be accepted Correct Answer one Your Answer one

Multiple Choice Multiple Answer Question Internal sources of funds are Correct Answer Funds from operations , Loss on sale of fixed assets , Goodwill written off Your Answer Loss on sale of fixed assets , Funds from long term loans

Select The Blank Question Subscription list of a public issue of shares shall be kept open for minimum ________ working days

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Correct Answer 3 Your Answer 15

Select The Blank Question Till the sales revenue reaches the break even point, the company ________ Correct Answer incurs the losses Your Answer earns profit

Select The Blank Question As per the Tandon Committee, the norms suggested for consumption of raw materials should be in ________ Correct Answer months Your Answer quarterly

True/False Question

Proprietary ratios is the relationship between owners funds and total assets

Correct Answer True Your Answer True

Multiple Choice Single Answer Question The discounted cash inflows match with discounted cash outflows is known as Correct Answer Internal Rate of return Your Answer Internal Rate of return

Multiple Choice Multiple Answer Question The characteristics of assets are Correct Answer They are acquired for use for long periods , They are ordinarily not meant for resale Your Answer They are acquired for use for long periods , They are ordinarily not meant for resale Select The Blank Question Investment of the venture capitalist does not exceed ________ so that the effective control of the project remains with the entrepreneur Correct Answer 0.49 Your Answer 0.49

True/False Question

Under hypothecation mode of security neither the property not the possession of the goods hypothecated is transferred to the Bank Correct Answer True

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Your Answer True

Multiple Choice Single Answer Question The mix of sources from which the long term funds required by a business are raised is termed as Correct Answer Capital Structure Your Answer Capital Budgeting

Multiple Choice Multiple Answer Question Indicate which of these are Profitability ratios Correct Answer Operating ratio , Gross Profit ratio Your Answer Operating ratio , Gross Profit ratio

Match The Following Question Financial ratios

Correct Answer Ratios disclosing the financial position or solvency of the firm

Your Answer Ratios disclosing the financial position or solvency of the firm

Profitability ratio Turnover ratios

Ratios which reflect the final Ratios which reflect the final results of business operations results of business operations Ratios measuring the Ratios measuring the efficiency efficiency with which the with which the assets are assets are employed by a firm employed by a firm Ratios which indicates the percentage of return on the total capital employed in the business Ratios which indicates the percentage of return on the total capital employed in the business

Overall profitability ratio

Multiple Choice Single Answer Question Current assets is in the form of Correct Answer Receivables Your Answer Land

True/False Question

Financial leverage is calculated as ( Sales - Variable cost ) / ( Earnings before Interest and tax - Interest ) Correct Answer False Your Answer True


				
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