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Financial Management MCQ Questions and Solutions with Explanations | Commerce

Financial Management 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. Financial Management 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-5 section-4

Each section contains 100 MCQs on Financial Management .
41
Non cash revenues are Rs 500,000 and net income is Rs 950,000 then net cash flow would be
Discuss
Answer & Solution
Answer: Option D
Solution:
Net Cash Flow = Net income - Non cash revenue
= 950000 - 500000 = Rs. 450000.
42
Cash and equivalents, inventories and accounts receivables are classified as
Discuss
Answer & Solution
Answer: Option A
Solution:
Cash and equivalents, inventories and accounts receivables are classified as Cash and equivalents, inventories and accounts receivables are classified as assets on balance sheet.
43
In situation of bankruptcy, stock which is recorded above common stock and below debt account is
Discuss
Answer & Solution
Answer: Option B
Solution:
In situation of bankruptcy, stock which is recorded above common stock and below debt account is preferred stock. Preferred stock refers to a class of ownership that has a higher claim on assets and earnings than common stock has.
44
If security pays Rs 5,000 in 20 years with 7% annual interest rate, PV of security by using formula is
Discuss
Answer & Solution
Answer: Option B
Solution:
Present Value = FV / ( 1 + r/100 )ⁿ
= 5000 / ( 1 + 7/100)²⁰
= Rs. 1292.10
45
An interest rate which is quoted by brokers, banks and other financial institutions is classified as
Discuss
Answer & Solution
Answer: Option C
Solution:
An interest rate which is quoted by brokers, banks and other financial institutions is classified as nominal rate. Nominal interest rate refers to the interest rate before taking inflation into account. Nominal can also refer to the advertised or stated interest rate on a loan, without taking into account any fees or compounding of interest.
46
Company who sells products to customer without demanding immediate payment but record it in balance sheet as
Discuss
Answer & Solution
Answer: Option B
Solution:
Company who sells products to customer without demanding immediate payment but record it in balance sheet as account receivable. Accounts receivable is the balance of money due to a firm for goods or services delivered or used but not yet paid for by customers.
47
Nominal rate which is quoted to consumers on loans is considered as
Discuss
Answer & Solution
Answer: Option A
Solution:
Nominal rate which is quoted to consumers on loans is considered as annual percentage rate. An annual percentage rate (APR) is the annual rate charged for borrowing or earned through an investment. APR is expressed as a percentage that represents the actual yearly cost of funds over the term of a loan.
48
An inventory recording in balance sheet includes
Discuss
Answer & Solution
Answer: Option D
Solution:
An inventory recording in balance sheet includes First in first out and Last in first out.
49
Values recorded as determined in marketplace are considered as
Discuss
Answer & Solution
Answer: Option A
Solution:
Values recorded as determined in marketplace are considered as market values. Market value is the price an asset gets in a marketplace. Market value also refers to the market capitalization of a publicly traded company.
50
A type of security payment in which payments are made at equal intervals of time and each payment amount is same is classified as
Discuss
Answer & Solution
Answer: Option C
Solution:
A type of security payment in which payments are made at equal intervals of time and each payment amount is same is classified as annuity. An annuity is a financial product that pays out a fixed stream of payments to an individual. These financial products are primarily used as an income stream for retirees.