FM assgn:43: Petrina
Select The Blank
Question
In case of Mortgage, the party who transfers the interest is called ________
Correct Answer Mortgager
Your Answer
True/False
Question
Mortgager
In case of cash credit, the company need not have a formal current account
Correct Answer True
Your Answer
True
True/False
Question
Overdraft is given by the bank for a very short period of time, at the end of which the
company is supposed to repay the same
Correct Answer True
Your Answer
True
Select The Blank
Question
The ratio of Market Price per share and Earning per share is termed as ________
Correct Answer Price earnings ratio
Your Answer
Price earnings ratio
Multiple Choice Multiple Answer
Question
The cost of managing inventory includes
Correct Answer Ordering cost , Carrying cost
Your Answer
Ordering cost , Carrying cost
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 , Dose not represent real liquid position
Multiple Choice Multiple Answer
Question
Advantages of letter of credit to the Exporter
Correct Answer He is assured to get the payment for the goods exported by him, if he satisfies all the
terms and conditions specified in the letter of credit , He can get the advance pending
against export proceeds receivable from the importer from its local bank
Your Answer
He is assured to get the payment for the goods exported by him, if he satisfies all the
terms and conditions specified in the letter of credit , He can get the advance pending
against export proceeds receivable from the importer from its local bank
Multiple Choice Multiple Answer
Question
Limitations of Average collection period
Correct Answer Average Collection period assumes that the credit sales are evenly spread throughout
the year. In practical circumstances, credit sales are not evenly spread throughout the
year , The amount of credit sales made by company or the normal credit period offered
by the company are not available in the published financial statements
Your Answer
Average Collection period assumes that the credit sales are evenly spread throughout
the year. In practical circumstances, credit sales are not evenly spread throughout the
year , The amount of credit sales made by company or the normal credit period offered
by the company are not available in the published financial statements
Multiple Choice Single Answer
Question
The Investment decisions are mainly concerned with
Correct Answer Application of funds
Your Answer
Application of funds
Multiple Choice Single Answer
Question
The term receivables is defined as
Correct Answer Debts owned to
ordinary course
Your Answer
Debts owned to
ordinary course
the firm by customers arising from sale of goods or services in the
of business
the firm by customers arising from sale of goods or services in the
of business
Multiple Choice Single Answer
Question
If the company buys the raw material from the suppliers on credit basis, it is termed as
Correct Answer Trade Credit
Your Answer
Trade Credit
Select The Blank
Question
________ is more useful to the management as a tool of financial analysis in short
periods
Correct Answer Cash flow analysis
Your Answer
Cash flow analysis
Select The Blank
Question
The projects having maximum positive Net present value will be ranked ________
Correct Answer highest
Your Answer
highest
Multiple Choice Multiple Answer
Question
The methods which consider the risk in capital budgeting decision are
Correct Answer Informal method , Risk adjusted discounting rate , Certainty-Equivalent approach
Your Answer
Informal method , Risk adjusted discounting rate , Certainty-Equivalent approach
Multiple Choice Single Answer
Question
Variable Working Capital is
Correct Answer the working capital required over and above the permanent working capital
Your Answer
the working capital required over and above the permanent working capital
Multiple Choice Single Answer
Question
The combined or weighted average cost of capital of the various individual components
is termed as
Correct Answer Composite cost
Your Answer
Composite cost
Multiple Choice Single Answer
Question
The main function of finance under the traditional approach comprises of
Correct Answer Procurement of funds
Your Answer
Procurement of funds
Select The Blank
Question
According to the provisions of the companies Act 1956, ________ can declare the
interim dividend
Correct Answer Board of Directors
Your Answer
Board of Directors
Match The Following
Question
Correct Answer
Your Answer
Increase in current liabilities
decreases working capital
decreases working capital
Increase in liabilities
inflow of funds
inflow of funds
Decrease in liabilities
outflow of funds
outflow of funds
Increase in current assets
increases working capital
increases working capital
Multiple Choice Multiple Answer
Question
International financial function of the organisation comprises of :
Correct Answer Study of flow of funds beyond national boundaries , Exchange of currencies
Your Answer
Study of flow of funds beyond national boundaries , Exchange of currencies
Multiple Choice Multiple Answer
Question
The advantages of continuous stock taking are
Correct Answer The figures of stock can be readily available for the purpose of periodic Profit and Loss
Account , It enables to locate slow and non-moving items
Your Answer
The figures of stock can be readily available for the purpose of periodic Profit and Loss
Account , It enables to locate slow and non-moving items
Multiple Choice Single Answer
Question
The ratio which indicates the extent to which the Owners' funds are sunk in different
kinds of assets is termed as
Correct Answer Proprietory ratio
Your Answer
Proprietory ratio
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
Your Answer
True
Select The Blank
Question
The introduction of debt capital in the capital structure increases the earnings per share
of ________
Correct Answer Equity shareholders
Your Answer
Equity shareholders
Multiple Choice Single Answer
Question
The effect of Purchase of machinery by issue of debentures on the funds flow is that
there will be
Correct Answer No effect on the funds flow
Your Answer
No effect on the funds flow
Multiple Choice Multiple Answer
Question
The effects of overcapitalisation are
Correct Answer Reduction in the market value of the shares , Credit standing of the company in the
market falls down and difficulty in raising futher capital
Your Answer
Reduction in the market value of the shares , Credit standing of the company in the
market falls down and difficulty in raising futher capital
Multiple Choice Multiple Answer
Question
Situation of capital rationing may involve problems in the form of
Correct Answer Mutually dependent project , Multi period projects , Project Indivisibility
Your Answer
Project Indivisibility , Mutually dependent project , Multi period projects
Multiple Choice Multiple Answer
Question
Under the Financial Analysis of the company done by Credit rating and Information
Services of India Ltd. the following points are covered
Correct Answer Accounting policies followed by the company , Adequacy of cash flows for fixed capital
Your Answer
Accounting policies followed by the company , Adequacy of cash flows for fixed capital
Multiple Choice Single Answer
Question
The traditional approach to financial management refers only to the procurement of
funds by
Correct Answer Corporate entity
Your Answer
Corporate entity
Multiple Choice Multiple Answer
Question
Limitations of capital budgeting is
Correct Answer Life of the project cannot
accurately , Difficulties in
Your Answer
Life of the project cannot
accurately , Difficulties in
Match The Following
Question
be estimated accurately , Cash inflows cannot be eatimated
deciding the cost of capital
be estimated accurately , Cash inflows cannot be eatimated
deciding the cost of capital
Correct Answer
Your Answer
Nayak committee
to recognize the contribution
made by the SSI sector to the
economy
to recognize the contribution made
by the SSI sector to the economy
Dahejia committee
to examine the extent to which
credit needs of industry and trade
are likely to be inflated and how
such trends could be checked
to examine the extent to which
credit needs of industry and trade
are likely to be inflated and how
such trends could be checked
Chhore committee
to review mainly the system of
to review mainly the system of
cash credit management policy by cash credit management policy by
banks
banks
Marathe committee
to review the credit authorization
scheme
to review the credit authorization
scheme
Multiple Choice Single Answer
Question
The rate of return which computes the average annual yield on the net investment in
the project is known as
Correct Answer Accounting rate of return
Your Answer
Accounting rate of return
Select The Blank
Question
Retained earnings is a source of ________ finance
Correct Answer Internal
Your Answer
Internal
True/False
Question
The combination of irrevocable and confirmed letter of credit can be considered to be a
guaranteed payment on the part of the exporter
Correct Answer True
Your Answer
True
Multiple Choice Single Answer
Question
The cost of equity shares may be decided on the basis of yields actually realised over
the period of past few years which may be expected to be continued in future also as
per the
Correct Answer Realised Yield Approach
Your Answer
Realised Yield Approach
Select The Blank
Question
Under ________, it is not only necessary to decide profitable investments but also
necessary to rank the acceptable proposals according to their relative profitabilities
Correct Answer Capital rationing
Your Answer
True/False
Question
Capital rationing
Cash from operation is the main internal source of cash
Correct Answer True
Your Answer
True
Select The Blank
Question
________ can be issued for the maturity period of 15 days to one year
Correct Answer Commercial Paper
Your Answer
Commercial Paper
True/False
Question
Operating leverage is calculated as Earnings Before Interest and Tax / ( Earnings before
Interest and Tax - Interest )
Correct Answer False
Your Answer
False
Select The Blank
Question
Continuous verification of physical stock to ensure that the physical balance and the
book balance tallies is carried under ________.
Correct Answer Perpetual Inventory system
Your Answer
Perpetual Inventory system
Multiple Choice Multiple Answer
Question
Advantages of factoring
Correct Answer Factoring is the way in which the company can finance its requirement of Working
capital in respect of receivables , The company can take advantage of the expertise of
the factor in various fields , With the help of factoring the company can be relieved of
administrative responsibilities
Your Answer
Factoring is the way in which the company can finance its requirement of Working
capital in respect of receivables , The company can take advantage of the expertise of
the factor in various fields , With the help of factoring the company can be relieved of
administrative responsibilities
Multiple Choice Single Answer
Question
The weighted average cost of capital is referred to as
Correct Answer Average cost
Your Answer
Average cost
Multiple Choice Single Answer
Question
The effect of Cash collected from Debtors on the funds flow is that there will be
Correct Answer No effect on the funds flow
Your Answer
True/False
Question
No effect on the funds flow
Ordering cost of inventory includes cost incurred for insurance
Correct Answer False
Your Answer
True/False
Question
False
Return on Assets is a ratio of relationship between Assets and Sales
Correct Answer False
Your Answer
False
Select The Blank
Question
The dealing with the financial matters of the government is termed as ________ field of
finance
Correct Answer Public
Your Answer
True/False
Question
Public
Public deposits are unsecured borrowings for the company
Correct Answer True
Your Answer
True