MCQOPTIONS
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MCQOPTIONS
This section includes 90 Mcqs, each offering curated multiple-choice questions to sharpen your Financial Management/Financial Markets knowledge and support exam preparation. Choose a topic below to get started.
| 1. |
The net worth is also called |
| A. | asset net of liabilities |
| B. | liabilities net of assets |
| C. | earnings net on assets |
| D. | liabilities net of earnings |
| Answer» B. liabilities net of assets | |
| 2. |
An annual rate of 16% if quoted by credit card issuer usually a bank is classified as |
| A. | loan rate of return |
| B. | local rate of return |
| C. | annual percentage rate |
| D. | annual rate of return |
| Answer» D. annual rate of return | |
| 3. |
If the payment of security is paid as $100 at the end of year for three years, it is an example of |
| A. | fixed payment investment |
| B. | lump sum amount |
| C. | fixed interval investment |
| D. | annuity |
| Answer» E. | |
| 4. |
The net income and depreciation is $313,650,000 and common shares outstanding are 55,000,000 then cash flow per share would be |
| A. | 5.7 |
| B. | 6.7 |
| C. | 7.7 |
| D. | 8.7 |
| Answer» B. 6.7 | |
| 5. |
The values of assets purchased or the liabilities recorded as recorded by bookkeepers are considered as |
| A. | appreciated values |
| B. | depreciated values |
| C. | market values |
| D. | book values |
| Answer» E. | |
| 6. |
The periodic rate if it is multiplied with per year number of compounding periods is called |
| A. | extrinsic rate of return |
| B. | intrinsic rate of return |
| C. | annual rate of return |
| D. | nominal annual rate |
| Answer» E. | |
| 7. |
The rate which is divided by compounding periods to calculate periodic rate must be |
| A. | annuity return |
| B. | deferred annuity return |
| C. | nominal rate |
| D. | semiannual discount rate |
| Answer» D. semiannual discount rate | |
| 8. |
If the deposited money $10,000 in bank pays interest 10% annually, an amount after five years will be |
| A. | 16105.1 dollars |
| B. | 0.01610 dollar per day |
| C. | 16105.1 dollars per year |
| D. | 16105.1 dollars per quarter |
| Answer» B. 0.01610 dollar per day | |
| 9. |
The total amount of depreciation charged on the long term assets is classified as |
| A. | accumulated depreciation |
| B. | depleted depreciation |
| C. | accumulated appreciation |
| D. | accumulated appreciation schedule |
| Answer» B. depleted depreciation | |
| 10. |
The claim against the assets are represented by |
| A. | saved earnings |
| B. | retained earnings |
| C. | maintained earnings |
| D. | saving account earnings |
| Answer» C. maintained earnings | |
| 11. |
The dividends paid to common shareholders and divided by common shares outstanding are equals to |
| A. | earnings per share |
| B. | dividends per share |
| C. | book value of share |
| D. | market value of shares |
| Answer» C. book value of share | |
| 12. |
In a statement of cash flows, a company investing in short-term financial investments and in fixed assets results in |
| A. | increased cash |
| B. | decreased cash |
| C. | increased liabilities |
| D. | increased equity |
| Answer» C. increased liabilities | |
| 13. |
The future value of annuity FVA (ordinary) is, if the deposited value is $100 and earn 5% every year of the total three years will be |
| A. | 315.25 dollars |
| B. | 331.0125 dollars |
| C. | 99.4875 dollars |
| D. | 318.25 dollars |
| Answer» B. 331.0125 dollars | |
| 14. |
An annuity with an extended life is classified as |
| A. | extended life |
| B. | perpetuity |
| C. | deferred perpetuity |
| D. | due perpetuity |
| Answer» C. deferred perpetuity | |
| 15. |
The values recorded as determined in the marketplace are considered as |
| A. | market values |
| B. | book values |
| C. | appreciated values |
| D. | depreciated values |
| Answer» B. book values | |
| 16. |
The student loans, mortgages and car loans are the examples of |
| A. | lump sum amount |
| B. | deferred annuity |
| C. | annuity due |
| D. | payment fixed series |
| Answer» C. annuity due | |
| 17. |
Until the word of preferred is used, an equity in balance sheet is treated as |
| A. | common equity |
| B. | preferred equity |
| C. | due equity |
| D. | common perpetuity |
| Answer» B. preferred equity | |
| 18. |
Earnings before interest, taxes, depreciation and amortization are calculated by |
| A. | subtracting operating cost from net sales |
| B. | subtracting net sales from operating costs |
| C. | adding operating cost and net sales |
| D. | adding interest and taxes |
| Answer» B. subtracting net sales from operating costs | |
| 19. |
The prices of bonds will be decreased if an interest rates |
| A. | rises |
| B. | declines |
| C. | equals |
| D. | none of above |
| Answer» B. declines | |
| 20. |
A company that sells products to customer without demanding immediate payment but record it in balance sheet as |
| A. | account payable |
| B. | account receivable |
| C. | account equivalent |
| D. | account investment |
| Answer» C. account equivalent | |
| 21. |
In the situation of bankruptcy, the stock which is recorded above common stock and below debt account is |
| A. | debt liabilities |
| B. | preferred stock |
| C. | hybrid stock |
| D. | common liabilities |
| Answer» C. hybrid stock | |
| 22. |
An interest rate is 5%, the number of period are 3, and the present value is $100, then the future value will be |
| A. | 115.76 |
| B. | 105 |
| C. | 110.25 |
| D. | 113.56 |
| Answer» B. 105 | |
| 23. |
The cash and equivalents, inventories and accounts receivables are classified as |
| A. | assets on balance sheet |
| B. | liabilities on balance sheet |
| C. | earnings on income statement |
| D. | payments on income statement |
| Answer» B. liabilities on balance sheet | |
| 24. |
In calculation of time, value of money, the ''N ''represents |
| A. | number of payment periods |
| B. | number of investment |
| C. | number of installments |
| D. | number of premium received |
| Answer» B. number of investment | |
| 25. |
A method of inventory recording which produces high inventories in balance sheet is classified as |
| A. | first out receivable |
| B. | first in first out |
| C. | last in first out |
| D. | last out receivable |
| Answer» C. last in first out | |
| 26. |
A loan that is repaid on monthly, quarterly and annual basis in equal payments is classified as |
| A. | amortized loan |
| B. | depreciated loan |
| C. | appreciated loan |
| D. | repaid payments |
| Answer» B. depreciated loan | |
| 27. |
An interest rate which is quoted by brokers, banks and other financial institutions is classified as |
| A. | annuity rate |
| B. | perpetuity rate |
| C. | nominal rate |
| D. | external rate of return |
| Answer» D. external rate of return | |
| 28. |
The wages and salaries of employees which company owns in this accounts are called |
| A. | accrued expenses |
| B. | accruals accounts |
| C. | both a and b |
| D. | zero liabilities |
| Answer» D. zero liabilities | |
| 29. |
An inventory recording in balance sheet includes |
| A. | first in first out |
| B. | last in first out |
| C. | last in last out |
| D. | both a and b |
| Answer» E. | |
| 30. |
The total common equity divided by common shares outstanding which is used to calculate |
| A. | book value of share |
| B. | market value of shares |
| C. | earnings per share |
| D. | dividends per share |
| Answer» B. market value of shares | |
| 31. |
The lottery payoffs and payment for rental apartments are the examples of |
| A. | lump sum amount |
| B. | deferred annuity |
| C. | annuity due |
| D. | payment fixed series |
| Answer» D. payment fixed series | |
| 32. |
The finance company providing loans at 3% with five compounding periods per year, the nominal annual rate is classified as |
| A. | 0.15 |
| B. | 0.006 |
| C. | 0.1 |
| D. | 0.01667 |
| Answer» B. 0.006 | |
| 33. |
The payment if it is divided with interest rate will be the formula of |
| A. | future value of perpetuity |
| B. | present value of perpetuity |
| C. | due perpetuity |
| D. | deferred perpetuity |
| Answer» C. due perpetuity | |
| 34. |
The net income is $2250 and the noncash charges are $1150 then the net cash flow would be |
| A. | 1100 |
| B. | 3400 |
| C. | 2200 |
| D. | 3500 |
| Answer» B. 3400 | |
| 35. |
The payment of security if it is made at the end of each period such as beginning of the year is classified as |
| A. | annuity due |
| B. | payment fixed series |
| C. | ordinary annuity |
| D. | deferred annuity |
| Answer» B. payment fixed series | |
| 36. |
The nominal rate which is quoted to consumers on the loans is considered as |
| A. | annual percentage rate |
| B. | annual rate of return |
| C. | loan rate of return |
| D. | local rate of return |
| Answer» B. annual rate of return | |
| 37. |
The finance company providing loans at 12% with 2 compounding periods per year, the periodic rate is classified as |
| A. | 3% per quarter |
| B. | 6% per quarter |
| C. | 6% per year |
| D. | 0.1667 % per year |
| Answer» D. 0.1667 % per year | |
| 38. |
A schedule which shows the interest constitutes reduced principal and unpaid balance is considered as |
| A. | repaid schedule |
| B. | depreciated schedule |
| C. | amortization schedule |
| D. | appreciated schedule |
| Answer» D. appreciated schedule | |
| 39. |
The total common equity $996,000,000 and the shares outstanding 50,000,000 then the book value per share would be |
| A. | 0.05 |
| B. | 15 |
| C. | 19.92 |
| D. | 14 |
| Answer» D. 14 | |
| 40. |
A type of security payment in which payments are made at equal intervals of time and each payment amount is same is classified as |
| A. | fixed interval investment |
| B. | fixed payment investment |
| C. | annuity |
| D. | lump sum amount |
| Answer» D. lump sum amount | |
| 41. |
The prices of bonds will be increased if the interest rates |
| A. | equals |
| B. | lump sum declines |
| C. | rises |
| D. | declines |
| Answer» E. | |
| 42. |
The accounts payable, accruals and notes payables are listed on balance sheet as |
| A. | accrued liabilities |
| B. | current liabilities |
| C. | accumulated liabilities |
| D. | noncurrent liabilities |
| Answer» C. accumulated liabilities | |
| 43. |
The noncash revenues are $500,000 and the net income is $950,000 then the net cash flow would be |
| A. | 475000 |
| B. | 485000 |
| C. | 1450000 |
| D. | 450000 |
| Answer» E. | |
| 44. |
The value of payment is $25 and an interest rate is 2%, then the present value will be |
| A. | 12.5 dollars |
| B. | 0.0008 dollars |
| C. | 1,250 dollars |
| D. | 0.8 dollars |
| Answer» D. 0.8 dollars | |
| 45. |
In the time value of money, the periodic rate is |
| A. | not shown on timeline |
| B. | shown on timeline |
| C. | multiplied on timeline |
| D. | divided on timeline |
| Answer» C. multiplied on timeline | |
| 46. |
The securities future value is $1,000,000 and the present value of securities is $500,000 with an interest rate of 4.5%, the 'N' will be |
| A. | 16.7473 years |
| B. | 0.0304 months |
| C. | 15.7473 years |
| D. | 0.7575 years |
| Answer» D. 0.7575 years | |
| 47. |
The earnings that are not paid as dividends to stockholders and have cumulative amount are classified as |
| A. | non-paid earnings |
| B. | common earnings |
| C. | retained earnings |
| D. | preferred earnings |
| Answer» D. preferred earnings | |
| 48. |
If security pays $5,000 in 20 years with 7% annual interest rate, the PV of security by using formula is |
| A. | 1292.10 dollars per year |
| B. | 1292.10 dollars |
| C. | 0.00077 dollars per year |
| D. | 16105.1 dollars per year |
| Answer» C. 0.00077 dollars per year | |
| 49. |
The rate charged by bank 12.5% on credit loans and 3% semiannually on installment loans is considered as |
| A. | periodic rate |
| B. | perpetuity rate of return |
| C. | annual rate |
| D. | annuity rate of return |
| Answer» B. perpetuity rate of return | |
| 50. |
The future value of annuity FVA (due) is, if the deposited value is $100 and earn 5% every year of the total three years will be |
| A. | 99.4875 dollars |
| B. | 318.25 dollars |
| C. | 315.25 dollars |
| D. | 331.0125 dollars |
| Answer» E. | |