Accounting and Financial Management 36

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Objective Questions and Answers of MBA: Accounting and Financial Management 36

Subject: Objective Questions and Answers of MBA: Accounting and Financial Management 36

Part 36: Objective questions and answers of Accounting and Financial Management

 

Q1. The most practical way to interpret or make sense of a firm's historical financial statements is through:

a) Profit analysis

b) Ratio analysis

c) Estimate statement

d) Forecast hypothesis

e) Assumption sheet

 

Q2. Maximizing shareholders wealth means maximizing the

a) Value of the firm's assets

b) Amount of the firm's cash

c) Value of the firm's investments

d) Total market value of the firm's common stock

 

Q3. Which of the following is not a current asset?

a) Cash in hand

b) Cash at bank

c) Debtors

d) Creditors

 

Q4. The length or time period of the operating cycle of any firm can be defined as

a) Operating cycle period

b) Inventory conversion period

c) Receivable conversion period

d) None

 

Q5. ______________ Management is the important task of the finance manager.

a) Debt

b) Equity

c) Profit

d) Cash

 

Q6. The time required to process and execute an order is called ______________.

a) Allowed time

b) Lead time

c) Accepted time

d) Fixed time

 

Q7. The acquisition of land by issuing common stock is

a) A noncash transaction that is not reported in the body of a statement of cash flows

b) A cash transaction and would be reported in the body of a statement of cash flows

c) A noncash transaction and would be reported in the body of a statement of cash flows

d) Only reported if the statement of cash flows is prepared using the direct method

 

Q8. A company would be expected to generate small amounts of cash provided by operating activities during the

a) Introductory phase

b) Growth phase

c) Maturity phase

d) Decline phase

 

Q9. Current ratio is 2:5. Current liability is rs.30000. The net working capital is

a) Rs.18,000

b) Rs.45,000

c) Rs.(-) 45,000

d) Rs.(-)18000

 

Q10. Working capital turnover measures the relationship of working capital with:

a) Fixed assets

b) Sales

c) Purchases

d) Stock

 

Q11. Debt to total assets ratio can be improved by:

a) Borrowing more

b) Issue of debenture

c) Issue of equity shares

d) Redemption of debt

 

Q12. Return on assets and return on investment ratios belong to:

a) Liquidity ratios

b) Profitability ratios

c) Solvency ratios

d) Turnover

 

Q13. Authorized capital of a company is rs.5 lac,40% of it is paid up.loss incurred during the year is rs.50,000. Accumulated loss carried from last year is rs.2 lac. The company has a tangible net worth of

a) Nil

b) Rs.2.50 lac

c) (-)rs.50,000

d) Rs.1 lac

 

Q14. Financial leverage means

a) Use of more debt capital to increase profit

b) High degree of solvency

c) Low bank finance

d) None of the above

 

Q15. The balance sheet is alternately known as:

a) Assets statement

b) Statement of financial position

c) Statement of profit and loss

d) None of the given options

 

Q16. ______________ is the ability of a firm to earn a profit.

a) Profitability

b) Liquidity

c) Efficiency

d) Effectiveness

e) Stability

 

Q17. ______________ are itemized forecasts of a company's income, expenses, and capital needs and are also an important tool for financial planning and control.

a) Profitability statements

b) Budgets

c) Owners' equity statements

d) Statements of cash flows

 

Q18. Which of the following statement is considered as the accountant's snapshot of firm's accounting value as of a particular date?

a) Income statement

b) Balance sheet

c) Cash flow statement

d) Retained earnings statement

 

Q19. The ______________ is the percentage change in operating income that results from a percentage change in sales.

a) Degree of financial leverage

b) Breakeven point

c) Degree of operating leverage

d) Degree of combined leverage

 

Q20. The asset which can be converted into cash whenever required without losing its value is

a) Current asset

b) Current liability

c) Fixed asset

d) Variable asset

 

Part 36: Objective questions and answers of Accounting and Financial Management

 

Q1. Answer b

 

Q2. Answer d

 

Q3. Answer d

 

Q4. Answer a

 

Q5. Answer d

 

Q6. Answer b

 

Q7. Answer a

 

Q8. Answer b

 

Q9. Answer d

 

Q10. Answer a

 

Q11. Answer d

 

Q12. Answer b

 

Q13. Answer c

 

Q14. Answer a

 

Q15. Answer b

 

Q16. Answer a

 

Q17. Answer b

 

Q18. Answer b

 

Q19. Answer c

 

Q20. Answer a

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