MCQ on Advance Financial Management 5

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Objective Questions and Answers of MBA: MCQ on Advance Financial Management 5

Subject: Objective Questions and Answers of MBA: MCQ on Advance Financial Management 5

Part 5: List for questions and answers of Advanced Financial Management


Q1. In the context of Funds Flow Analysis, the word “funds” is used to define

a) Net Working capital

b) Total current assets-Total current liabilities

c) Both a and b

d) None of the above


Q2. During the year, a business was bought by issue of Rs 25,000 debentures and Rs 25,000 shares. The business bought had machine worth Rs 20,000, Debtors Rs 15,000, Stock Rs 5,000 and Creditors Rs 5,000. Determine the effect of this transaction on flow of funds

a) Net outflow of Rs 15,000

b) Net inflow of Rs 15,000

c) Neither inflow nor outflow

d) None of the above


Q3. Which of the following are Non-current assets?

a) Land, Building and plant

b) Leasehold property

c) Computer software

d) All of the above


Q4. Bond, debentures and term loans falls under

a) Current assets

b) Non-current assets

c) Non-current liabilities

d) Current liabilities


Q5. Funds flow statements are prepared so as to

a) To identify the changes in working capital

b) To identify reasons behind change in working capital

c) To know the item-wise outflow of funds during given period

d) All of the above


Q6. Funds Flow Statement holds significance for

a) Shareholders

b) Financiers

c) Government

d) All of the above 


Q7. The share capital of A Ltd. stood at Rs 20,00,000 in 2013 and at Rs 26 lac in 2014. As per records, the company bought asset of another company for Rs 6 lac payable in fully paid shares. These assets included Goodwill Rs 2,00,000 Machinery Rs 1, 83, 600 and Stock Rs 2,16,400. What is the fund from issue of shares?

a) Rs 2,15,600

b) Rs 2,16,400

c) Rs 2,00,000

d) None of the above


Q8. Debentures are Rs 2,50,000 and Rs 3,50,000 in the balance sheet of 2013 and 2014. 1000 of the debentures of Rs 100 each were issued at par in 2014 of which 400 debentures were issued to a supplier for the purchase of a machine. Determine amount of issue for debentures for the purpose of funds flow statement

a) Rs 60,000

b) Rs 40,000

c) RS 10,000

d) None of the above


Q9. In the balance sheet of Praveen for 2013 and 2014, 4% debentures are Rs 5,00,000 and Rs 4,00,000, respectively. Profit on redemption of debentures in 2013 is nil while in 2014 is Rs 4,000. What is the amount of redemption for the purpose of funds flow statement?

a) Rs 96,000

b) Rs 1,04,000

c) Rs 9,00,000

d) Rs 9,04,000


Q10. The balance of property at cost has been RS 20,000 and Rs 17,000 in 2013 and 2014 respectively. The profit on sale of property of Rs 2000 is credited to Capital Reserves Account. New property costing Rs 5000 bought in 2014. Determine sale of proceeds from land

a) Rs 3000

b) Rs 10,000

c) Rs 7000

d) Rs 15,000 


Q11. The Balance sheet of Ram at end of 2013 and 2014 disclose investments in shares of Rs 2000 and Rs 3000, respectively. Rs 100 as pre-acquisition dividend has been credited to investments account. Determine purchase of investments

a) RS 5000

b) Rs 1000

c) Rs 1,100

d) None of the above


Q12. The balance of fixed assets of Y Ltd. at cost at the end of 2013 and 2014 were Rs 5,70,800 and Rs 6,15,300. During the year 2014 a machinery costing Rs 60,000 was sold. Determine the purchase of fixed assets

a) Rs 1,04,500

b) Rs 1,40,500

c) Rs 1,64,500

d) None of the above


Q13. Which of the following are applications of funds?

a) Payment of dividend on share capital

b) Payment of tax

c) Increase in working capital

d) All of above


Q14. Which of the following are treated as long term investments?

a) Non-current investments

b) Trade Investments

c) Sinking fund investments

d) All of the above


Q15. Banking or banking action that is consistent with main beliefs of Shariah and its realistic application from beginning to end improvement of Islamic economics is

a) islamic banking

b) development Bank

c) conventional banking

d) b and c


Q16. A number of Islamic banks were formed to provide to this particular banking market in late

a) 20th century

b) 19th century

c) 18th century

d) none of all of these 


Q17. A bank is considered as a custodian and trustee of money is

a) Wadiah

b) safekeeping

c) a and b

d) Hibah


Q18. Earliest Islamic bank was established in Malaysia in

a) 1980

b) 1983

c) 1982

d) 1988


Q19. Negotiation of a selling price among two parties exclusive of reference by seller to either costs or asking price is

a) ijarah wa iqtna

b) ijarah

c) musawamah

d) musharika


Q20. Provision of taxation is treated as

a) As a current liability

b) As an appropriation of profits

c) Either a or b

d) None of the above


Part 5: List for questions and answers of Advanced Financial Management


Q1. Answer: c

Q2. Answer: b

Q3. Answer: d

Q4. Answer: c

Q5. Answer: d

Q6. Answer: d

Q7. Answer: b

Q8. Answer: a

Q9. Answer: a

Q10. Answer: b

Q11. Answer: c

Q12. Answer: b

Q13. Answer: d

Q14. Answer: d

Q15. Answer: a

Q16. Answer: a

Q17. Answer: c

Q18. Answer: b

Q19. Answer: c

Q20. Answer: c