MCQOPTIONS
Saved Bookmarks
MCQOPTIONS
This section includes 2436 Mcqs, each offering curated multiple-choice questions to sharpen your Commerce knowledge and support exam preparation. Choose a topic below to get started.
| 351. |
Factoring is a ---------------- |
| A. | Cost of sales |
| B. | Production plan |
| C. | Financial planning |
| D. | New financial service |
| Answer» E. | |
| 352. |
The financial management is responsible for the |
| A. | Controlling of the Organization |
| B. | Organizing trading programs |
| C. | Recording the transaction |
| D. | Finance function of the firm |
| Answer» E. | |
| 353. |
Total assets – Total external liabilities equal to --------------------- |
| A. | Net asset |
| B. | Net liabilities |
| C. | Net cost |
| D. | Net depreciation |
| Answer» B. Net liabilities | |
| 354. |
The weighted average cost of new or additional capital is called |
| A. | Opportunity cost |
| B. | Composite cost |
| C. | Marginal cost |
| D. | Average cost |
| Answer» D. Average cost | |
| 355. |
Under ----- method more than one forecast of the future cash inflows ie. Optimistic, pessimistic and most likely are made |
| A. | Certainty equivalent method |
| B. | Sensitivity technique |
| C. | Standard deviation method |
| D. | Coefficient of variation method |
| Answer» C. Standard deviation method | |
| 356. |
The ratio which is obtained by dividing the present value of future cash inflows by thepresent value of cash out flows is called |
| A. | Net Present Value |
| B. | IRR |
| C. | Profitability Index |
| D. | Average rate of return |
| Answer» D. Average rate of return | |
| 357. |
------ refers to the minimum return expected by its suppliers |
| A. | Trading on equity |
| B. | Time value of money |
| C. | Cost of capital |
| D. | Capital gearing |
| Answer» D. Capital gearing | |
| 358. |
The cost of each component of capital is known as |
| A. | Specific cost |
| B. | Combined cost |
| C. | Average cost |
| D. | Implicit cost |
| Answer» B. Combined cost | |
| 359. |
In proper capital budgeting analysis, we evaluate incremental |
| A. | Accounting income |
| B. | Cash flow |
| C. | Earnings |
| D. | Operating profit |
| Answer» C. Earnings | |
| 360. |
Every debenture holders is a ---------------- |
| A. | Owner of the company |
| B. | Creditor of the company |
| C. | Supplier of the company |
| D. | Customer of the company |
| Answer» C. Supplier of the company | |
| 361. |
--------------- theory is applicable only when the dividend pay out ratio is 100% |
| A. | MM theory |
| B. | NOI theory |
| C. | Net income approach |
| D. | None of these |
| Answer» B. NOI theory | |
| 362. |
Face value per debenture less issue expenses equal to --------------- |
| A. | Net proceeds per debentures |
| B. | Cost of capital |
| C. | Loss |
| D. | Profit |
| Answer» B. Cost of capital | |
| 363. |
Capital structure decisions should always aim at having debt component in order to |
| A. | Gain tax savings |
| B. | Gain control over the company |
| C. | Balance the capital structure |
| D. | Increase the earnings available for shareholders. |
| Answer» E. | |
| 364. |
Return on equity measures the profitability of ------------------- invested in the firm |
| A. | Capital |
| B. | Equity funds |
| C. | Book debt |
| D. | Debentures and book dept |
| Answer» C. Book debt | |
| 365. |
ABC Analysis is used in |
| A. | Inventory Management |
| B. | Receivables Management |
| C. | Accounting Policies |
| D. | Corporate Governance |
| Answer» B. Receivables Management | |
| 366. |
Collateralized borrowing and lending obligation (CBLO) is a discounted instrumentavailable in electronic book entry for the maturity period ranging from __________. |
| A. | 1 day to 19 days |
| B. | 1 day to 15 days |
| C. | 1 day to 30 days |
| D. | None of the above |
| Answer» B. 1 day to 15 days | |
| 367. |
Stock holder’s wealth = ____________ |
| A. | No. of shares owned x Current stock price per share |
| B. | No. of shares owned x Current stock price per share |
| C. | No. of shares owned x Current stock price per share |
| D. | none |
| Answer» B. No. of shares owned x Current stock price per share | |
| 368. |
Profit maximization includes --------------------- |
| A. | It is indicator of economic efficiency |
| B. | Source of incentive |
| C. | Maximization of social benefit |
| D. | Measurement of success of business decisions |
| Answer» E. | |
| 369. |
After tax cost of debt is equal to (1-t)x |
| A. | Ko |
| B. | WACC |
| C. | Before tax cost of debt |
| D. | KE |
| Answer» D. KE | |
| 370. |
During inflationary period the risk free interest rate will be ……………………………. |
| A. | Lower |
| B. | Does not change |
| C. | Higher |
| D. | Cannot say |
| Answer» D. Cannot say | |
| 371. |
Overall cost of capital, according to ------ approach, decreases up to a certain point, remainsunchanged for moderate increase in debt thereafter, and increase beyond a certain point |
| A. | Net income |
| B. | Net operating income |
| C. | Traditional |
| D. | MM approach |
| Answer» D. MM approach | |
| 372. |
According NO1 theory ,value of firm is |
| A. | Related to its capital structure |
| B. | Not related to its capital structure |
| C. | Related to debt |
| D. | Related to overall cost of capital |
| Answer» C. Related to debt | |
| 373. |
Which one is the Benefit(s) of Factoring? |
| A. | Better Cash Flows |
| B. | Better Assets Management |
| C. | Better Working Capital Management |
| D. | All of the above |
| Answer» E. | |
| 374. |
Which is the instrument of finance |
| A. | Zero coupon bonds |
| B. | Debt securitization |
| C. | Credit card |
| D. | All of these |
| Answer» E. | |
| 375. |
What do you mean by NPV? |
| A. | Excess of cash inflows over cash outflows |
| B. | Excess of cash outflows over cash inflows |
| C. | Excess of the present value of cash out flows over the present value of cash inflows |
| D. | Excess of the present value of cash inflows over the present value of cash outflows |
| Answer» E. | |
| 376. |
Which of the following is not a characteristic of GDR? |
| A. | Is a negotiable instrument |
| B. | Carry voting rights |
| C. | Freely tradable in International Market |
| D. | Denominated in US Dollars |
| Answer» C. Freely tradable in International Market | |
| 377. |
EBIT= Rs. 1120000, PBT= Rs. 320000, Fixed Costs= Rs. 700000, Operating Leverage = |
| A. | 1.625 |
| B. | 2.625 |
| C. | 6.625 |
| D. | 3.625 |
| Answer» B. 2.625 | |
| 378. |
which of the following was set up based on the recommendations of Vaghul Committee? |
| A. | National Stock Exchange |
| B. | Stock Holding Corporation of India Ltd |
| C. | Discount and Finance House of India Ltd |
| D. | National Securities Depository Ltd |
| Answer» D. National Securities Depository Ltd | |
| 379. |
According to NOI theory, the value of the firm depends on ----------- |
| A. | Financial risk |
| B. | Operational risk |
| C. | Technological risk |
| D. | Business risk |
| Answer» D. Business risk | |
| 380. |
Which of the following is the main objective of financial management? |
| A. | Revenue Maximisation |
| B. | Profit Maximisation |
| C. | Wealth Maximisation |
| D. | Cost Minimisation |
| Answer» D. Cost Minimisation | |
| 381. |
------ refers to that EBIT level at which EPS remains the same irrespective of the debt- equity mix. |
| A. | Profit point |
| B. | Cut off point |
| C. | Point of indifference |
| D. | None of these |
| Answer» D. None of these | |
| 382. |
Dividends are the ---------- of a company distributed amongst members in proportion to their shares |
| A. | Divisible profits |
| B. | Indivisible profits |
| C. | Reserves |
| D. | Assets with cash and bank |
| Answer» B. Indivisible profits | |
| 383. |
Implicit cost also called …………………………. |
| A. | Marginal cost |
| B. | Composite cost |
| C. | Opportunity cost |
| D. | Average cost |
| Answer» D. Average cost | |
| 384. |
The company can reduce its capital by ------------- |
| A. | Convertible share |
| B. | Payment of loan |
| C. | Redemption of redeemable preference shares |
| D. | Payment of interest |
| Answer» B. Payment of loan | |
| 385. |
When contribution is dividend with EBIT we get |
| A. | Operating leverage |
| B. | Financial leverage. |
| C. | P/V ratio |
| D. | EPS |
| Answer» B. Financial leverage. | |
| 386. |
Funds Flow Statement reveals the change in _______________ between two BalanceSheet dates. |
| A. | Working capital |
| B. | Internal capital |
| C. | Share capital |
| D. | Both (A) & (C) |
| Answer» B. Internal capital | |
| 387. |
The debt capital can be raised from issue of ----- |
| A. | Bonds |
| B. | Equity share capital |
| C. | Right share |
| D. | Preference share capital |
| Answer» B. Equity share capital | |
| 388. |
While calculating the weighted average cost of capital, market value weights are preferredbecause |
| A. | Book value weights are historical in nature |
| B. | It is vary difficult to estimate book value weights at the time of calculating the weighted average cost |
| C. | This is in conformity with the definition of cost of capital as the investor’s minimum required rate of return |
| D. | Book value weights fluctuate violently. |
| Answer» D. Book value weights fluctuate violently. | |
| 389. |
Which ratio reveals how profitability of the owner’s funds have been utilized by the firm? |
| A. | Return on equity |
| B. | Current ratio |
| C. | Fixed asset ratio |
| D. | Debt equity ratio |
| Answer» B. Current ratio | |
| 390. |
At Indifference level of EBIT, different capitals have: |
| A. | same EBIT |
| B. | same EPS |
| C. | same PAT |
| D. | same PBT |
| Answer» C. same PAT | |
| 391. |
If funds are required for productive purpose ------- finance is suitable |
| A. | Debt |
| B. | Equity |
| C. | Retained earnings |
| D. | None of these |
| Answer» B. Equity | |
| 392. |
Which of the following factors is/ are considered when a capital structure decision is taken? |
| A. | Cost of capital |
| B. | Dilution control |
| C. | Floatation cost |
| D. | All of the above |
| Answer» E. | |
| 393. |
A company should follow the policy of ----- gear during inflation or boom period |
| A. | High gear |
| B. | Low gear |
| C. | Medium gear |
| D. | Any of the above |
| Answer» B. Low gear | |
| 394. |
Payback period in which an expected cash flows are discounted with the help ofproject cost of capital is classified as |
| A. | discounted payback period |
| B. | discounted rate of return |
| C. | discounted cash flows |
| D. | discounted project cost |
| Answer» B. discounted rate of return | |
| 395. |
SPO refers to ________, the second and subsequent time a company raises moneyfrom the public directly. |
| A. | Second Public Offering |
| B. | Subsequent Public Offering |
| C. | Subsequent Public Offer |
| D. | Seasonal Public Offering |
| Answer» C. Subsequent Public Offer | |
| 396. |
Capital budgeting means ---------------------------- |
| A. | Planning for capital asset |
| B. | Planning for sales |
| C. | Planning for cash |
| D. | Planning for profit |
| Answer» B. Planning for sales | |
| 397. |
Buying a security from low priced market and selling at high priced market is called ------------- |
| A. | Speculation |
| B. | Arbitrage |
| C. | Gangbling |
| D. | Investment |
| Answer» C. Gangbling | |
| 398. |
The 'Dividend-Payout Ratio' is equal to |
| A. | The Dividend yield plus the capital gains yield |
| B. | Dividends per share divided by Earning per Equity Share |
| C. | Dividends per share divided by par value per share |
| D. | Dividends per share divided by current price per share |
| Answer» C. Dividends per share divided by par value per share | |
| 399. |
The cost of debt capital if interest rate is 15% and tax rate is 40% is |
| A. | 6% |
| B. | 8.5% |
| C. | 9% |
| D. | 10.5% |
| Answer» D. 10.5% | |
| 400. |
Factoring involves ---------------- |
| A. | Provision of specialized services relating to credit investigation |
| B. | Sales ledger management |
| C. | Purchase and collection of debts |
| D. | All of these |
| Answer» E. | |