Capital Budgeting Decisions are:
|C.||for short term|
|D.||involves small amount|
|Answer» B. Irreversible|
Which of the following is not incorporated in Capital Budgeting?
|B.||Time Value of Money|
|C.||Required Rate of Return|
|D.||Rate of Cash Discount|
|Answer» D. Rate of Cash Discount|
PERT / CPM have to be used for proper ……………….. of all projects
|Answer» B. controlling|
BSC is important for ………
|C.||evaluating the performance of a strategy|
|Answer» C. evaluating the performance of a strategy|
Classification of responsibility center is based on the nature of the monetary ……………
|A.||Inputs and/or outputs|
|B.||Inputs and outputs|
|Answer» A. Inputs and/or outputs|
Discretionary expenses are expenses ………
|A.||that do not create value|
|B.||that do not hamper the operations immediately|
|C.||that are completely unnecessary|
|D.||that are necessary|
|Answer» B. that do not hamper the operations immediately|
For the board of directors of the company, the entire company is a ……………….
|Answer» C. Responsibility center|
In a revenue center the primary measurement is ………………….
|A.||Output in physical terms|
|B.||Input in cost terms|
|D.||Cost incurred by center|
|Answer» C. Revenue|
In case of discretionary expense center, the financial center is primarily exercised at ………. Stage.
|Answer» D. Planning|
In case of revenue center the output is measured in ……………. terms, but no formal attempt is made to relate ……………….
|A.||Physical, quantity and quality|
|B.||Monetary, efficiency and effectiveness|
|C.||Monetary, input and output|
|D.||Monetary, output only|
|Answer» C. Monetary, input and output|
In financial performance measurement most important is ……………
|Answer» A. EVA|
Performance management is …………….
|D.||Strategic management tool|
|Answer» C. Business process|
Profit centre profit is calculated ……....
|A.||before debiting Corporate overheads|
|B.||after debiting corporate overheads|
|C.||without considering corporate overheads|
|D.||along with corporate overhead|
|Answer» B. after debiting corporate overheads|
A major part of strategy implementation is …….
|Answer» C. Resource allocation|
The Enterprise Performance Management core processes does not include which of the following?
|D.||Consolidation and Reporting|
|Answer» C. Business Analytics|
The Malcolm Baldrige Award is awarded by the Government of ……….
|Answer» D. U.S.A.|
The responsibility center whose inputs are measured in monetary terms, but whose output is not, is ………………..
|Answer» B. Expense center|
Two step transfer prices depend on ……………….
|C.||corporate profit requirement|
|D.||SBU profit requirement|
|Answer» C. corporate profit requirement|
Which of the following does not belong to the category of quantitative performance indicators?
|Answer» C. Levels of|
Which of the following is correct? ROI =
|A.||Income / Asset employed|
|B.||Revenue / Asset employed|
|C.||Cost / Revenue|
|D.||Profit / No. of shares outstanding|
|Answer» A. Income / Asset employed|
Which of the following is not a financial performance measure?
|A.||Opening cash flow|
|B.||Return on assets|
|Answer» D. Market share/growth|
Which of the following is not an entity with reference to Baldrige Criteria / Framework?
|D.||Work Force Focus|
|Answer» A. Team Focus|
The selective and analytical approach to control investment in various types of inventories is known as ……………………………
|B.||Gross Margin Return on Investment (GMROI)|
|C.||Multiple Attribute Method|
|D.||Sell Through Analysis|
|Answer» A. ABC Analysis|
The Sell Through Analysis is not about ………………………
|B.||Inventory/ Sales Turn Over|
|Answer» A. Sales|
The Non-profit Organization focus more on ………..
|Answer» A. Social welfare/interests|
The time the activity would take if things did not go well is known as
|B.||Most likely time|
|Answer» A. Pessimistic time|
Which of the following is responsible for establishing a private company’s internal control?
|C.||Management and auditors|
|D.||Committee of Sponsoring Organizations|
|Answer» A. Management|
A responsibility center in which the manager is held accountable for the profitable use of assets and capital is commonly known as a(n)
|Answer» D. Investment center|
In the balanced scorecard approach quality would come under which perspective?
|A.||The internal perspective|
|B.||The customer perspective|
|C.||The financial perspective|
|D.||The innovation and learning perspective|
|Answer» A. The internal perspective|
Performance management is believed to have originated from which country?
|Answer» D. USA|
The overall purpose of the balanced scorecard approach is to:
|A.||Help turn strategy into action|
|B.||Benchmark against competitors|
|C.||Measure financial performance|
|D.||Measure product quality|
|Answer» A. Help turn strategy into action|
The process of evaluating an employee’s current and/or past performance relative to his or her performance standards is called
|Answer» C. performance appraisal|
The term 'EVA' is used for:
|A.||Extra Value Analysis|
|B.||Economic Value Added|
|C.||Expected Value Analysis|
|D.||Engineering Value Analysis|
|Answer» B. Economic Value Added|
The U.S. National Quality Award is named after
|C.||W. Edwards Deming|
|Answer» D. Malcolm Baldrige|
Which of the following statements is false? Balanced scorecards
|A.||Are one type of performance dashboard|
|B.||Can be cascaded to different levels/parts of organisations|
|C.||Cannot be used in conjunction with budgetary control systems|
|D.||Can be used to produce strategy maps|
|Answer» C. Cannot be used in conjunction with budgetary control systems|
Which of the following statements regarding flaws suffered by financial measures is not correct:
|A.||They are hard to quantify|
|B.||They do little to motivate employees to improve accounting profits|
|C.||They are not effective in getting managers' attention|
|D.||They are useful in identifying operational problems|
|Answer» D. They are useful in identifying operational problems|
Which of the following variable does ROI examine?
|Answer» B. EVA|
A sound Capital Budgeting technique is based on:
|C.||Interest Rate on Borrowings|
|D.||Last Dividend Paid|
|Answer» A. Cash Flows|
Capital Budgeting deals with:
|C.||Both (a) and (b)|
|D.||Neither a) nor (b)|
|Answer» A. Long-term Decisions,|
Capital Budgeting Decisions are based on:
|B.||Incremental Cash Flows|
|Answer» B. Incremental Cash Flows|
Capital Budgeting is a part of:
|B.||Working Capital Management|
|Answer» A. Investment Decision|
Which of the following is not applied in capital budgeting?
|A.||Cash flows be calculated in incremental terms|
|B.||All costs and benefits are measured on cash basis|
|C.||All accrued costs and revenues be incorporated|
|D.||All benefits are measured on after-tax basis|
|Answer» C. All accrued costs and revenues be incorporated|
Which of the following is not followed in capital budgeting?
|A.||Cash flows Principle|
|B.||Interest Exclusion Principle|
|Answer» C. Accrual Principle|
Which of the following is not true for capital budgeting?
|A.||Sunk costs are ignored|
|B.||Opportunity costs are excluded|
|C.||Incremental cash flows are considered|
|D.||Relevant cash flows are considered|
|Answer» B. Opportunity costs are excluded|
Which of the following is not used in Capital Budgeting?
|A.||Time Value of Money|
|C.||Net Assets Method|
|Answer» C. Net Assets Method|
Which one is the Capital Expenditure?
|A.||Capital invested by the owner|
|B.||Selling expense for machine|
|D.||Daily expenses to operate business|
|Answer» C. Machine purchased|
Who among the following have the authority to inspect the books of accounts?
|C.||Officer of Sebi|
|D.||Both (a) and (c)|
|Answer» D. Both (a) and (c)|
Under responsibility accounting, the evaluation of a manager’s performance is based on matters that the manager:
|B.||Directly and indirectly controls|
|D.||Has shared responsibility for with another manager|
|Answer» A. Directly controls|
Return on Assets and Return on Investment Ratios belong to:
|Answer» B. Profitability Ratios|
………….. costs are not easily changed and are often fixed, for ex, once a company has decided to rent a place.
|Answer» A. Committed|
Management by objective is the process in which
|A.||Top management sets objectives for the sub- ordinate managers|
|B.||Budgeteer proposes to accomplish specific jobs and prepares budget for it.|
|C.||A manager decides his own area of operations and prepares budget for it.|
|D.||Budget is not prepared at all.|
|Answer» B. Budgeteer proposes to accomplish specific jobs and prepares budget for it.|
Return on Assets (ROA) ratio is given by which of the following?
|A.||Net Income/ Sales|
|B.||Sales / Total Assets|
|C.||Net Income/ Total Assets|
|D.||Gross Margin/ Net Sales|
|Answer» C. Net Income/ Total Assets|
The Strategic Business Unit evolved during the ………………………
|A.||1970s & 1980s|
|Answer» A. 1970s & 1980s|
The strategic Business Unit evolved from …………………
|A.||Hierarchy- based structure of organization|
|B.||Function based structure of organization|
|C.||Territorial structure of organization|
|D.||Divisional structure of organization|
|Answer» D. Divisional structure of organization|
There are four elements of Anthony’s model. Which one does not belong to the group?
|Answer» D. Rejecter|
Total control over discretionary expense center is achieved primarily through ……… performance measures.
|Answer» B. Non-financial|
Which of the following areas is not covered under the Baldrige Award?
|D.||Multi National Corporation (MNC)|
|Answer» D. Multi National Corporation (MNC)|
Which of the following is an example of lead indication?
|Answer» A. Market share|
If project A has a lower payback period than project B, this may indicate that project A may have a …………….
|A.||Lower NPV and be less profitable|
|B.||Higher NPV and be less profitable|
|C.||Higher NPV and be more profitable|
|D.||Lower NPV and be more profitable|
|Answer» C. Higher NPV and be more profitable|
The primary capital budgeting method that uses discounted cash flow techniques is the ……....
|A.||Net present value method|
|B.||Cash payback technique|
|C.||Annual rate of return method|
|D.||Profitability index method|
|Answer» A. Net present value method|
Which of the following ignores the time value of money?
|A.||Internal rate of return|
|C.||Net present value|
|Answer» D. Cash payback|
Which of the following is not true? Asset employed is equal to
|A.||Non-current liabilities + shareholder’s equity|
|B.||Total assets – current liabilities|
|C.||Non-current assets + working capital|
|D.||Shareholder’s equity –current liabilities|
|Answer» D. Shareholder’s equity –current liabilities|
As asset becomes Non Performing after default of ……………………
|Answer» C. 90 days|
As per the RBI guidelines banks have to make sure that out of their loan assets loans are given to Priority Sector.
|Answer» B. 40%|
The capital adequacy ratio to be maintained by public sector banks in India is ……………....
|Answer» D. 12%|
The Retailer is selling the merchandise for more than it costs the Retailer to acquire it, then the GMROI Ratio would be ……………………
|A.||Higher than 1|
|B.||Equal to 1|
|C.||Less than 1|
|D.||Equal to 3.2|
|Answer» A. Higher than 1|
Which of the following do not fall under Financial inclusion ?
|A.||Nationalization of Banks|
|B.||Public Sector Lending targets|
|C.||Zero Balance Accounts|
|D.||Education at affordable cost|
|Answer» D. Education at affordable cost|
While calculating the Gross Margin Ratio on Investment (GMROI), the TWO important aspects are:
|A.||Stock on Hand and Stock-Outs incidents|
|B.||Gross Margin and Average Inventory Cost|
|C.||Gross Revenue and Stock on Hand|
|D.||Carrying Costs and Stock-Out Costs|
|Answer» B. Gross Margin and Average Inventory Cost|
Assembling project team and assigning their responsibilities are done during which phase of project management?
|Answer» B. Project Initiation|
PERT is the
|A.||Time oriented technique|
|B.||Event oriented technique|
|C.||Activity oriented technique|
|D.||Target oriented technique|
|Answer» B. Event oriented technique|
Which of the following is not one of the eight specific principles of Social Audit?
|Answer» D. Non-Participatory|
Which of the following statement about NPOs is not true?
|A.||The NPOs generally tend to be service organisations|
|B.||The NPOs receive ‘Contributed Capital’ and have no shareholders|
|C.||The sources of funds for NPOs are more or less captive|
|D.||The NPOs are subjected to Market Mechanism|
|Answer» D. The NPOs are subjected to Market Mechanism|
Which is not a primary objective of audit?
|A.||Detection and Prevention of Errors|
|B.||Examining the System of internal check|
|C.||Verifying the authenticity and validity of transactions|
|D.||Confirming the existence and value of assets and liabilities|
|Answer» A. Detection and Prevention of Errors|
Which of the following area is not covered by management audit?
|A.||System and Procedures|
|B.||Board’s / Directors Analysis|
|C.||Research and development|
|D.||New product development cycle time|
|Answer» D. New product development cycle time|
Which of the following area is specially covered by Management Audit?
|A.||Economic Contribution Analysis|
|C.||Social Cost-Benefit Analysis|
|Answer» A. Economic Contribution Analysis|
Assuming that it is not the first appointment of the auditor, who is responsible for the appointment of the auditor?
|A.||The Shareholders in a general meeting|
|B.||The Managing director|
|C.||The board of directors in board meeting|
|D.||The audit committee|
|Answer» A. The Shareholders in a general meeting|
A Balanced Scorecard helps the organisation to:
|A.||Be ready and prepared to implement an ERP|
|B.||Be focus on all the relevant business perspectives|
|C.||Integrate strategy and key challenges|
|D.||Communicate better with staff|
|Answer» B. Be focus on all the relevant business perspectives|
A cost center manager
|A.||Does not have the ability to produce revenue|
|B.||May be involved with the sale of new marketing programs to clients.|
|C.||Would normally be held accountable for producing an adequate return on invested capital.|
|D.||Often oversees divisional operations|
|Answer» A. Does not have the ability to produce revenue|
According to DuPont analysis, increase in the profit margin (all else constant) should
|A.||Increase both ROE and ROA|
|B.||Increase ROE but not ROA|
|C.||Increase ROA but not ROE|
|D.||Increase neither ROA nor ROE|
|Answer» A. Increase both ROE and ROA|
DU PONT Analysis deals with
|A.||Analysis of Current Assets|
|B.||Analysis of Profit|
|D.||Analysis of Fixed Assets|
|Answer» B. Analysis of Profit|
If return on investment is a measure used on the balanced scorecard, under which perspective would it be listed
|C.||Learning and growth perspective|
|D.||Internal business perspective|
|Answer» A. Financial perspective|
Pitfalls exists the same as with any new technology or management tool. All of the following describe these pitfalls except
|A.||Some companies use too few measures in their score|
|B.||Some companies include too many measures|
|C.||A poor scorecard is the biggest threat and one of the dangerous pitfalls|
|D.||Some companies do not know how to implement the effective drivers of performance|
|Answer» C. A poor scorecard is the biggest threat and one of the dangerous pitfalls|
Responsibility centers include
|Answer» D. Profit center|
Responsibility reports for cost centers
|A.||Distinguish between fixed and variable costs|
|B.||Use static budget data|
|C.||Include both controllable and non-controllable costs|
|D.||Include only controllable costs|
|Answer» D. Include only controllable costs|
Return on Investment may be improved by one of these
|C.||decreasing Capital Utilization|
|Answer» A. Increasing Turnover|
ROI can be viewed as a function of the net profit margin times
|C.||The total asset turnover|
|Answer» C. The total asset turnover|
The Balanced Scorecard approach has been criticized for leaving out certain measures. One of these is:
|B.||Employee satisfaction measures|
|C.||Customer satisfaction measures|
|D.||Technological innovation measures|
|Answer» B. Employee satisfaction measures|
The drive in world markets to produce superior goods has led some countries to recognize or award prizes. What is the name of U.S. prize for developing quality products:
|A.||the Deming Prize|
|B.||Malcolm Baldridge National Quality Award|
|C.||the J.D. Power Award|
|D.||the K.C. Irving Quality Award|
|Answer» B. Malcolm Baldridge National Quality Award|
The following are basic elements in which Continuous Improvement framework (leadership; planning; service orientation; information and analysis; employees and workplace climate; process management; excellence levels and trends
|B.||Total Quality Management (TQM)|
|D.||Malcolm Baldridge Quality Award|
|Answer» D. Malcolm Baldridge Quality Award|
What is a measure of operating performance that indicates how successful the firm has been at increasing its MVA in a given year.
|A.||Economic value added (EVA)|
|B.||After-tax cash flow (ATCF)|
|C.||Earnings after taxes (EAT)|
|D.||Market value added (MVA)|
|Answer» A. Economic value added (EVA)|
What is not included in a firm’s expenses?
|A.||Costs of goods sold|
|Answer» D. Dividends|
What is the term used to describe the value assigned to the goods or services sold or rented from one unit of an organization to another
|D.||Full service cost|
|Answer» C. Transfer price|
When managers of subunits throughout an organization strive to achieve the goals set by top management, the result is
|B.||Planning and control|
|D.||Delegation of decision making|
|Answer» A. Goal congruence|
Which of the following statements about performance management systems is not true?
|A.||Performance management systems are ineffective|
|B.||They encourage a short-term view among managers|
|C.||Recommendations are prescriptive and suggest one best way|
|D.||They improve organisational performance in the long-term|
|Answer» D. They improve organisational performance in the long-term|
Which transfer pricing method will preserve the subunit autonomy?
|Answer» B. Negotiated pricing|
Controllable costs, as used in a responsibility accounting system, consist of:
|A.||Only fixed costs.|
|B.||Only direct materials and direct labor.|
|C.||Those costs that a manager can influence in the time period under review.|
|D.||Those costs about which a manager has some knowledge. Those costs that are influenced by parties external to the organization.|
|Answer» C. Those costs that a manager can influence in the time period under review.|
Evaluation of Capital Budgeting Proposals is based on Cash Flows because:
|A.||Cash Flows are easy to calculate|
|B.||Cash Flows are suggested by SEBI|
|C.||Cash is more important than profit|
|D.||None of the above|
|Answer» C. Cash is more important than profit|
Sale of machine of machine merchandising business is –
|Answer» D. Revenue receipt|
What do we call a formal comparison of the actual costs and benefits of a project with original estimates?
|D.||Business scorecard report|
|Answer» A. Post-completion audit|
Compliance with the Standard of Auditing is the responsibility of
|B.||Those charged with governance|
|Answer» C. Auditor|