McqMate
These multiple-choice questions (MCQs) are designed to enhance your knowledge and understanding in the following areas: Bachelor of Business Administration (BBA) , Bachelor of Banking and Insurance (BBI) , Bachelor of Commerce (B Com) .
Chapters
| 101. |
___________ is required to meet special exigencies such as launching of extensive marketing campaigns for conducting research. |
| A. | seasonal working capital |
| B. | special working capital |
| C. | reserve working capital |
| D. | regular working capital |
| Answer» B. special working capital | |
| 102. |
The statement of changes in financial position prepared to determine only the sources and uses of working capital between two dates of balance sheet is known as __________. |
| A. | cash flow statement |
| B. | memorandum balance sheet |
| C. | fund flow statement |
| D. | profit and loss account |
| Answer» C. fund flow statement | |
| 103. |
What are the aspects of working capital management? |
| A. | inventory management |
| B. | receivable management |
| C. | cash management |
| D. | all of the above |
| Answer» D. all of the above | |
| 104. |
_________ function includes a firm’s attempts to balance cash inflows and outflows. |
| A. | finance |
| B. | liquidity |
| C. | investment |
| D. | dividend |
| Answer» B. liquidity | |
| 105. |
Firms which are capital intensive rely on _________. |
| A. | equity |
| B. | short term debt |
| C. | debt |
| D. | retained earnings |
| Answer» C. debt | |
| 106. |
Hirer is entitled to claim ___________. |
| A. | depreciation |
| B. | salvage value |
| C. | hp payments |
| D. | none of above |
| Answer» A. depreciation | |
| 107. |
Which of the following is not an advantages of trade credit? |
| A. | easy availability |
| B. | flexibility |
| C. | informality |
| D. | buyout financing |
| Answer» D. buyout financing | |
| 108. |
Which of the following are theories for dividend relevance? |
| A. | walter’s model |
| B. | mm approach |
| C. | game theory |
| D. | market value theory |
| Answer» A. walter’s model | |
| 109. |
What is not a form of dividend? |
| A. | cash dividends |
| B. | bonus shares(stock dividend) |
| C. | share split |
| D. | split reverse |
| Answer» D. split reverse | |
| 110. |
The percentage of earnings paid as dividends is called __________. |
| A. | dividend policy |
| B. | payout ration |
| C. | cash dividends |
| D. | reverse split |
| Answer» B. payout ration | |
| 111. |
What are the various methods of estimating cash? |
| A. | receipts and payment method |
| B. | adjusted profit & loss method |
| C. | balance sheet method |
| D. | all of the above |
| Answer» D. all of the above | |
| 112. |
The art of managing, within the acceptable level of risk, the consolidated funds optimally and profitably is called _________. |
| A. | integrated treasury |
| B. | treasury management |
| C. | merchant banking |
| D. | none of the above |
| Answer» B. treasury management | |
| 113. |
What are the different types of underlying assets? |
| A. | stocks |
| B. | bonds |
| C. | currency |
| D. | stock indices |
| Answer» D. stock indices | |
| 114. |
What are people who buy or sell in the market to make profits called? |
| A. | hedgers |
| B. | speculators |
| C. | arbitrageurs |
| D. | none of the above |
| Answer» B. speculators | |
| 115. |
Which of the following is a technique that helps the exporter to sell the receivables to any bank or financial institution without recourse? |
| A. | forfeiting |
| B. | leading & lagging |
| C. | derivatives |
| D. | netting |
| Answer» A. forfeiting | |
| 116. |
Money market financial services not include: |
| A. | bill discounting |
| B. | merchant banking |
| C. | leasing |
| D. | securitization |
| Answer» B. merchant banking | |
| 117. |
Factoring involves: |
| A. | providing short term loan |
| B. | providing long term loan |
| C. | financing of export receivables |
| D. | management of receivables of borrower |
| Answer» D. management of receivables of borrower | |
| 118. |
The tools of treasury management does not include: |
| A. | foreign exchange management |
| B. | cash management |
| C. | receivable management |
| D. | risk management |
| Answer» D. risk management | |
| 119. |
Under which type of bank borrowing can a borrower obtain credit from a bank against its bills? |
| A. | letter of credit |
| B. | cash |
| C. | purchase or discounting of bills |
| D. | working capital loan |
| Answer» C. purchase or discounting of bills | |
| 120. |
The factors that affect dividend policy are: |
| A. | tax consideration |
| B. | privatization |
| C. | foreign investment |
| D. | working cash flow |
| Answer» A. tax consideration | |
| 121. |
To financial analysts, "working capital" means the same thing as __________. |
| A. | total assets |
| B. | fixed assets |
| C. | current assets |
| D. | current assets minus current liabilities. |
| Answer» C. current assets | |
| 122. |
Which of the following would be consistent with an aggressive approach to financing working capital? |
| A. | financing short-term needs with short-term funds. |
| B. | financing permanent inventory buildup with long-term debt. |
| C. | financing seasonal needs with short-term funds. |
| D. | financing some long-term needs with short-term funds. |
| Answer» D. financing some long-term needs with short-term funds. | |
| 123. |
Which of the following would be consistent with a conservative approach to financing working capital? |
| A. | financing short-term needs with short-term funds. |
| B. | financing short-term needs with long-term debt. |
| C. | financing seasonal needs with short-term funds. |
| D. | financing some long-term needs with short-term funds. |
| Answer» B. financing short-term needs with long-term debt. | |
| 124. |
-Which of the following would be consistent with a hedging (maturity matching) approach to financing working capital? |
| A. | financing short-term needs with short-term funds. |
| B. | financing short-term needs with long-term debt. |
| C. | financing seasonal needs with long-term funds. |
| D. | financing some long-term needs with short-term funds. |
| Answer» A. financing short-term needs with short-term funds. | |
| 125. |
The amount of current assets that varies with seasonal requirements is referred to as __________ working capital. |
| A. | permanent |
| B. | net |
| C. | temporary |
| D. | gross |
| Answer» C. temporary | |
| 126. |
A budget is a plan of action expressed in… |
| A. | financial terms |
| B. | non‐financial terms |
| C. | both |
| D. | subjective matter |
| Answer» C. both | |
| 127. |
Budget is prepared for a… |
| A. | indefinite period |
| B. | definite period |
| C. | period of one year |
| D. | six months |
| Answer» B. definite period | |
| 128. |
A budget is tool which helps the management in planning and control of… |
| A. | all business activities |
| B. | production activities |
| C. | purchase activities |
| D. | sales activities |
| Answer» A. all business activities | |
| 129. |
Budgetary control system acts as a friend, philosopher and guide to the… |
| A. | management |
| B. | share holders |
| C. | creditors |
| D. | employees |
| Answer» A. management | |
| 130. |
Budgetary control system defines the objectives and policies of the… |
| A. | production department |
| B. | finance department |
| C. | marketing department |
| D. | all |
| Answer» D. all | |
| 131. |
Budgetary control facilitates easy introduction of the… |
| A. | marginal costing |
| B. | ratio analysis |
| C. | standard costing |
| D. | subjective matter |
| Answer» C. standard costing | |
| 132. |
Budgetary control helps the management in… |
| A. | obtaining bank credit |
| B. | issue of shares |
| C. | getting grants from government |
| D. | all of these |
| Answer» A. obtaining bank credit | |
| 133. |
Budgetary control system helps the management to eliminate… |
| A. | undercapitalization |
| B. | overcapitalization |
| C. | both |
| D. | subjective matter |
| Answer» C. both | |
| 134. |
Budgetary control provides a basis for… |
| A. | bonus shares |
| B. | rights shares |
| C. | remuneration plans |
| D. | none |
| Answer» C. remuneration plans | |
| 135. |
Budgetary control helps to introduce a suitable incentive and remuneration based on… |
| A. | changes in government policies |
| B. | inflationary conditions |
| C. | both |
| D. | none |
| Answer» B. inflationary conditions | |
| 136. |
Budgetary control __________ replace management in decision‐making. |
| A. | can |
| B. | cannot |
| C. | sometimes |
| D. | inadequate data |
| Answer» B. cannot | |
| 137. |
The success of budgetary control system depends upon the willing cooperation of… |
| A. | shareholders |
| B. | management |
| C. | creditors |
| D. | all the functional areas of management |
| Answer» D. all the functional areas of management | |
| 138. |
Recording of actual performance is…. |
| A. | an advantage of budgetary control |
| B. | a step in budgetary control |
| C. | a limitation of budgetary control |
| D. | none |
| Answer» B. a step in budgetary control | |
| 139. |
Revision of budgets is… |
| A. | unnecessary |
| B. | can’t determine |
| C. | necessary |
| D. | inadequate data |
| Answer» C. necessary | |
| 140. |
Frequent revision of budgets will… |
| A. | affects its reliability |
| B. | increase the accuracy |
| C. | both |
| D. | subjective matter |
| Answer» A. affects its reliability | |
| 141. |
Usually the production budget is stated in terms of… |
| A. | money |
| B. | quantity |
| C. | both |
| D. | none |
| Answer» C. both | |
| 142. |
Budget period is the… |
| A. | period of budget committee |
| B. | period of budget centres |
| C. | period for which a budget is prepared |
| D. | period of budget officer |
| Answer» C. period for which a budget is prepared | |
| 143. |
Budget period depends upon… |
| A. | the type of budget |
| B. | the nature of business |
| C. | the length of trade cycles |
| D. | all of these |
| Answer» D. all of these | |
| 144. |
A key factor is one which restricts… |
| A. | the volume of production |
| B. | the volume of sales |
| C. | the volume of purchase |
| D. | all of the above |
| Answer» A. the volume of production | |
| 145. |
Plant utilization budget and Manufacturing overhead budgets are types of. |
| A. | production budget |
| B. | sales budget |
| C. | cost budget |
| D. | none of the above |
| Answer» A. production budget | |
| 146. |
R&D budget and Capital expenditure budget are examples of |
| A. | short-term budget |
| B. | current budget |
| C. | long-term budget |
| D. | none of the above |
| Answer» C. long-term budget | |
| 147. |
The scare factors is also known as |
| A. | key factor |
| B. | abnormal factor |
| C. | linking factor |
| D. | none of the above |
| Answer» A. key factor | |
| 148. |
A budgeting process which demands each manager to justify his entire budget in detail from beginning is |
| A. | functional budget |
| B. | master budget |
| C. | zero base budgeting |
| D. | none of the above |
| Answer» C. zero base budgeting | |
| 149. |
Budgetary control system facilitates centralized control with… |
| A. | decentralized activity |
| B. | centralized activity |
| C. | both |
| D. | none |
| Answer» C. both | |
| 150. |
Fixed assets are Rs 5,00,000 , Current assets are Rs 3,00,000, Current liabilities are Rs 1,00,000. There is no investment. Capital employed will be : |
| A. | rs 8,00,000 |
| B. | rs 7,00,000 |
| C. | rs 9,00,000 |
| D. | rs 6,00,000 |
| Answer» B. rs 7,00,000 | |
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