Business Finance MCQ Questions and Solutions with Explanations

Business Finance MCQ Questions and Solutions with Explanations | Commerce

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-6 section-7

Under the current rate method, when the management anticipates appreciation of a foreign currency, which of the following techniques will it use to enhance its position?

A) It may try to increase net exposed assets in that country B) It may try to decrease net exposed assets in that country C) It may move funds from cash into inventories D) It may change to consolidating financial statements under the provisions of FASB#8

Discuss

Answer & Solution

Answer: Option A

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

Capital budgeting is related to

A) Long-term assets B) Short-term assets C) Long-term and short-term assets D) Fixed assets

Discuss

Answer & Solution

Answer: Option A

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

An operation in order to protect the domestic currency value of an asset or a liability that is denominated in foreign currency is called as

A) Hedging B) Hermes C) Indexation D) Leading

Discuss

Answer & Solution

Answer: Option A

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

Which of the following statement is correct regarding calculation of weighted cost of capital?

A) Retained earnings are always excluded B) Preference capital is given more weight C) Cost of issue is considered D) Weights are always based on the book values

Discuss

Answer & Solution

Answer: Option C

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

Which combination of the following factors influences the working capital requirement?
(i) Market conditions
(ii) Production policy
(iii) Firm's goodwill
(iv) Supply conditions

A) (i), (ii) and (iii) B) (ii), (iii) and (iv) C) (i), (iii) and (iv) D) (i), (ii) and (iv)

Discuss

Answer & Solution

Answer: Option D

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

The value of a bond with a given maturity period is

A) The present value of maturity value of the bond B) The present value of annual interest plus the present value of maturity value C) The total amount of interest plus the maturity value received D) The maturity value received

Discuss

Answer & Solution

Answer: Option A

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

Which of the following is the proportion of earnings paid to common shareholders in the form of a cash dividend?

A) Price-earnings Ratio B) Retention Rate C) Growth Rate D) Dividend Payout Ratio

Discuss

Answer & Solution

Answer: Option D

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

Operating leases are mostly . . . . . . . . agreements.

A) long-term B) medium-term C) short-term D) verbal

Discuss

Answer & Solution

Answer: Option C

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

Working capital is

A) WCR plus short-term debt plus cash B) WCR minuss hort-term debt minus cash C) Equity plus long-term debt plus non-current assets D) Equity plus long-term debt minus non-current assets

Discuss

Answer & Solution

Answer: Option D

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

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

A) Retained earnings have no cost because no interest or dividend is paid on them B) Cost of capital means the minimum rate of return, which a company should get on its investment C) Both A and B D) None of the above

Discuss

Answer & Solution

Answer: Option B

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