Explore topic-wise MCQs in Master of Commerce (MDotcom).

This section includes 15 Mcqs, each offering curated multiple-choice questions to sharpen your Master of Commerce (MDotcom) knowledge and support exam preparation. Choose a topic below to get started.

1.

According to . principle the ideal pattern of capital structure is one that tends to minimize the cost of financing.

A. Control principle
B. Cost principle
C. Risk principle
D. Flexibility principle
Answer» C. Risk principle
2.

.principle says that issue of debt and preference shares do not affect the interest of equity share holders.

A. Cost principle
B. Risk principle
C. Control principle
D. Timing principle
Answer» D. Timing principle
3.

Operating lease is favoured by the lessee in respect of assets which depreciate in value on account of ..

A. Obsolescence
B. Wear and tear
C. Exhaustion
D. Fire
Answer» B. Wear and tear
4.

A firm that acquires another firm as part of its strategy to sell off assets, cut costs, and operate the remaining assets more efficiently is engaging in __________.

A. Strategic acquisition
B. Two tier tender offer
C. A financial acquisition
D. Shark repellent
Answer» B. Two tier tender offer
5.

The lessee can protect himself against obsolescence by entering into a capital lease agreement with the lessor.

A. True
B. False
C. none
D. all
Answer» C. none
6.

..is a long term lease and the lessee will be paying much more than the cost of the property or equipment to the lessor in the form of lease charges.

A. Operating lease
B. Financial lease
C. Leveraged lease
D. Direct lease
Answer» C. Leveraged lease
7.

is the combination of two or more organisation in a related industry but do not offer same product.

A. Horizontal
B. Vertical
C. Concentric
D. Conglomerate
Answer» D. Conglomerate
8.

is the process under which an existing large company purchases the business of another small company doing similar business.

A. Merger
B. Acquisition
C. Absorption
D. Take over
Answer» D. Take over
9.

The acquisition of a firm in the same industry, but at a different stage of the production process is called

A. Conglomerate
B. Forward
C. Vertical
D. Horizontal
Answer» D. Horizontal
10.

.. isa type of takeover in which the acquiring company turns itself into a subsidiary of the purchased company.

A. Bailout takeover
B. Reverse takeover
C. Backflip
D. Conglomerate
Answer» D. Conglomerate
11.

. is the ratio in which an acquiring company will offer its own shares in exchange for the target company s share during merger .

A. Swap ratio
B. Price- earnings ratio
C. Exchange ratio
D. Enterprise value to sales ratio
Answer» B. Price- earnings ratio
12.

This strategy enables the existing shareholders of the target company to buy additional shares at a high discount rate.

A. Flip- in
B. Flip over
C. Spin out
D. Spin off.
Answer» B. Flip over
13.

The process by which company or organisation is divided and thereby becomes an independent business is called ..

A. Spin out
B. Spin off
C. Split off
D. Sell off
Answer» B. Spin off
14.

..isan acquisition in which management team of the company purchases assets and operation they manage.

A. LBO
B. MBO
C. Demerger
D. Stubs
Answer» C. Demerger
15.

A firm that acquires another firm as part of its strategy to sell off assets, cut costs, and operate the remaining assets more efficiently is engaging in __________.

A. Strategic acquisition
B. A financial acquisition
C. Two tier tender offer
D. Shark repellent
Answer» C. Two tier tender offer