Accounting and Financial Management 20

COEP
Lets Crack Online Exam

Objective Questions and Answers of MBA: Accounting and Financial Management 20

Subject: Objective Questions and Answers of MBA: Accounting and Financial Management 20

Part 20: Objective questions and answers of Accounting and Financial Management

 

Q1. In case of divisible projects, which of the following can be used to attain maximum npv?

a) Feasibility set approach

b) Internal rate of return

c) Profitability index approach

d) Any of the above

 

Q2. Risk of a capital budgeting can be incorporated

a) Adjusting the cash flows

b) Adjusting the discount rate

c) Adjusting the life

d) All of the above

 

Q3. Firm's cost of capital is the average cost of:

a) All sources

b) All borrowings

c) Share capital

d) Share bonds & debentures

 

Q4. Operating leverage helps in analysis of:

a) Business risk

b) Financing risk

c) Production risk

d) Credit risk

 

Q5. Use of preference share capital in capital structure

a) Increases ol

b) Increases fl

c) Decreases ol

d) Decreases fl

 

Q6. Relationship between change in sales and d operating profit is known as:

a) Financial leverage

b) Operating leverage

c) Net profit ratio

d) Gross profit ratio

 

Q7. 'That there is no corporate tax' is assumed by:

a) Net income approach

b) Net operating income approach

c) Traditional approach

d) All of these

 

Q8. Which of the following appearing in the balance! Generates tax advantage and hence affects the c, structure decision?

a) Reserves and surplus

b) Long-term debt

c) Preference share capital

d) Equity share capital

 

Q9. If ke = r, then under walter's model, which of the following is irrelevant?

a) Earnings per share

b) Dividend per share

c) Dp ratio

d) None of the above

 

Q10. Dividends are paid out of

a) Accumulated profits

b) Gross profit

c) Profit after tax

d) General reserve

 

Q11. If the real rate of return is 10% and inflation s money discount rate is:

a) 14.4%

b) 2.5%

c) 25%

d) 14%

 

Q12. Which of the following cost of capital require tax adjustment?

a) Cost of equity shares

b) Cost of preference shares

c) Cost of debentures

d) Cost of retained earnings

 

Q13. In order to calculate the proportion of equity financing used by the company, the following should be used:

a) Authorized share capital

b) Equity share capital plus reserves and surplus

c) Equity share capital plus preference share capital

d) Equity share capital plus long-term debt

 

Q14. If 'r' = 'ke', than mp by walter's model and gordon's model for different payout ratios would be

a) Unequal

b) Zero

c) Equal

d) Negative

 

Q15. Combined leverage can be used to measure the relationship between:

a) Ebit and eps

b) Pat and eps

c) Sales and eps

d) Sales and ebit

 

Q16. If a company issues new share capital to redeem debentures, then:

a) Ol will increase

b) Fl will increase

c) Ol will decrease

d) Fl will decrease

 

Q17. Financial break-even level of ebit is:

a) Intercept at y-axis

b) Intercept at x-axis

c) Slope of ebit-eps line

d) None of the above

 

Q18. Net operating income approach, which one of the lowing is constant?

a) Cost of equity

b) Cost of debt

c) Wacc & kd

d) Ke and kd

 

Q19. Which of the following is true?

a) Under traditional approach, overall cost of capital remains same

b) Under ni approach, overall cost of capital remains same

c) Under noi approach, overall cost of capital remains same

d) None of the above

 

Q20. 'Bird in hand' argument is given by

a) Walker's model

b) Gordon's model

c) Mm mode

d) Residuals theory

 

Part 20: Objective questions and answers of Accounting and Financial Management

 

Q1. Answer c

 

Q2. Answer d

 

Q3. Answer a

 

Q4. Answer a

 

Q5. Answer b

 

Q6. Answer b

 

Q7. Answer d

 

Q8. Answer b

 

Q9. Answer c

 

Q10. Answer c

 

Q11. Answer a

 

Q12. Answer c

 

Q13. Answer b

 

Q14. Answer c

 

Q15. Answer c

 

Q16. Answer d

 

Q17. Answer b

 

Q18. Answer c

 

Q19. Answer c

 

Q20. Answer b

Be the first to comment

Leave a Reply