Business Finance MCQ Questions and Solutions with Explanations

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Business Finance MCQ Questions and answers with easy and logical explanations. Commerce provides you all type of quantitative and competitive aptitude mcq questions with easy and logical explanations. Business Finance MCQ is important for exams like B.COM, M.COM, BBA, BBM, CA, CS, CMA, CPA, CFA, UPSC, NET, Banking and other commerce department exam. Page-4 section-6

Each section contains 100 MCQs on Business Finance .

The following situation may occur when there is an increase in the number of shares outstanding by reducing the par value of the stock.

A) Stock split B) Stock dividend C) Extra dividend D) Regular dividend

Discuss

Answer & Solution

Answer: Option A

No explanation is given for this question. Let's Discuss on Board

Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest (SARFAESI) Act was enacted in which year?

A) 2000 B) 2001 C) 2002 D) 2003

Discuss

Answer & Solution

Answer: Option C

No explanation is given for this question. Let's Discuss on Board

Which of the following statement(s) is/are correct?

A) The cost of retained earnings is always less than the cost of external equity B) The cost of external equity is always less than the cost of retained earnings C) The cost of retained earnings is power than the cost of external equity in presence of floatation costs D) None of the above

Discuss

Answer & Solution

Answer: Option C

No explanation is given for this question. Let's Discuss on Board

Arrange the following terms of working capital cycle involves in correct sequence.
1. Acquisition of raw material
2. Finished goods
3. Receivables
4. Cash
5. Work-in-progress

A) 4, 3, 1, 5, 2 B) 1, 2, 3, 4, 5 C) 1, 5, 2, 3, 4 D) 4, 1, 2, 3, 5

Discuss

Answer & Solution

Answer: Option D

No explanation is given for this question. Let's Discuss on Board

Which of the following statements is true?

A) The cost of work-in-progress includes raw materials, wages and factory overheads B) Cost of finished goods is estimated at profit amount C) Delay in payment of certain expenses provides long-term financing of working capital D) None of the above

Discuss

Answer & Solution

Answer: Option A

No explanation is given for this question. Let's Discuss on Board

Which of the following can be defined as the term of a finance lease?

A) It is cancellable B) The legal title to the asset is with the lessee C) The asset is capitalized in the balance sheet of the lessee D) The lessor is responsible for service and maintenance of the asset

Discuss

Answer & Solution

Answer: Option C

No explanation is given for this question. Let's Discuss on Board

What is the beta for averagerisk security? What is the beta for a treasury bill?

A) 1; 0 B) 0; 1 C) Greater than 1; 1 D) 1; greater than 1

Discuss

Answer & Solution

Answer: Option A

No explanation is given for this question. Let's Discuss on Board

What does 'Yield to Maturity' in the context of bonds indicate?

A) The fixed cost of the organization B) The effectiverate of interest C) The facevalue of the bond D) It reflects the rating by the credit rating agency

Discuss

Answer & Solution

Answer: Option B

No explanation is given for this question. Let's Discuss on Board

Our firm has a philosophy that is analogous to hedging (maturity matching) approach. Which of the following is the most appropriate non-spontaneous form for financing the excess seasonal current asset needs?

A) Trade credit B) Currency notes C) Accounts payable D) Common stock equity

Discuss

Answer & Solution

Answer: Option B

No explanation is given for this question. Let's Discuss on Board

A firm with high operating leverage has

A) Low fixed cost in its production process B) High variable cost in its production process C) High fixed cost in its production process D) Low variable cost in its production process

Discuss

Answer & Solution

Answer: Option C

No explanation is given for this question. Let's Discuss on Board

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Business Finance MCQ Questions and Solutions with Explanations | Commerce