Financial Management MCQ Questions and Solutions with Explanations

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-8 section-12

'Judicious use of leverage' is suggested by:

A) Net Income Approach B) Net Operating Income Approach C) Traditional Approach D) All of the above

Discuss

Answer & Solution

Answer: Option C

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

If the average balance of debtors has increased, which of the following might not show a change in general?

A) Total Sales B) Average Payables C) Current Ratio D) Bad Debt loss

Discuss

Answer & Solution

Answer: Option B

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

Which of the following has the highest cost of capital?

A) Equity shares B) Loans C) Bonds D) Preference shares

Discuss

Answer & Solution

Answer: Option A

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

In Net Operating Income Approach, which one of the following is constant?

A) Cost of Equity B) Cost of Debt C) WACC & k_d D) k_e and k_d

Discuss

Answer & Solution

Answer: Option C

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

Which of the following is not relevant for dividend payment for a year?

A) Cash flow position B) Profit position C) Paid up capital D) Retained earnings

Discuss

Answer & Solution

Answer: Option D

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

If cash discount is offered to customers, then which of the following would increase?

A) Sales B) Debtors C) Debt collection period D) All 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 is incorrect for value of the firm?

A) In the initial preposition, MM Model argues that value is independent of the financing mix B) Total value of levered and unlevered firms is otherwise arbitrage will take place C) Total value incorporates borrowings by firm but excludes personal borrowing D) Total value does not change because underlying does not change with financing mix

Discuss

Answer & Solution

Answer: Option D

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

Which of the following is not a capital budgeting decision?

A) Expansion Programme B) Merger C) Replacement of an Asset D) Inventory Level

Discuss

Answer & Solution

Answer: Option D

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

Cost of Capital refers to:

A) Flotation Cost B) Dividend C) Required Rate of Return D) None of the above

Discuss

Answer & Solution

Answer: Option C

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

MM Model of Dividend irrelevance uses arbitrage between:

A) Dividend and Bonus B) Dividend and Capital Issue C) Profit and Investment D) None of the above

Discuss

Answer & Solution

Answer: Option B

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