Financial Management MCQ Questions and Solutions with Explanations | Commerce

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41.
In case of Net Income Approach, the Cost of equity is:

A. Constant

B. Increasing

C. Decreasing

D. None of the above

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42.
Cash Discount term 3/15, net 40 means:

A. 3% discount if payment in 15 days, otherwise full payment in 40 days

B. 15% discount if payment in 3 days, otherwise full payment 40 days

C. 3% interest if payment made in 40 days and 15% interest thereafter

D. None of the above

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43.
Which of the following is not a generally accepted approach for Calculation of Cost of Equity?

A. CAPM

B. Dividend Discount Model

C. Rate of Pref. Dividend plus Risk

D. Price-Earnings Ratio

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44.
The basic objective of Tandon Committee recommendations is that the dependence of industry on bank should gradually:

A. Increase

B. Remain Stable

C. Decrease

D. None of the above

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45.
'That there is no corporate tax' is assumed by:

A. Net Income Approach

B. Net Operating Income Approach,

C. Traditional Approach

D. All of these

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46.
If a firm has no preference share capital, financial break-even level is defined as equal to:

A. EBIT

B. Interest liability

C. Equity dividend

D. Tax liability

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47.
If the closing balance of receivables is less than the opening balance for a month then which one is true out of:

A. Collections > Current Purchases

B. Collections > Current Sales

C. Collections < Current Purchases

D. Collections < Current Sales

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48.
Under the provisions of AS-19 'Leases', a leased asset is shown in the balance sheet of:

A. Manufacturer

B. Lessor

C. Lessee

D. Financing bank

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49.
FL is zero if:

A. EBIT = Interest

B. EBIT = Zero

C. EBIT = Fixed Cost

D. EBIT = Pref. Dividend

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50.
In stock dividend:

A. Authorized capital always increases

B. Paid up capital always increases

C. Face value per share decreases

D. Market price for share decreases

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Financial Management MCQ Questions and Solutions with Explanations | Commerce

41. In case of Net Income Approach, the Cost of equity is:

Answer & Solution

42. Cash Discount term 3/15, net 40 means:

Answer & Solution

43. Which of the following is not a generally accepted approach for Calculation of Cost of Equity?

Answer & Solution

44. The basic objective of Tandon Committee recommendations is that the dependence of industry on bank should gradually:

Answer & Solution

45. 'That there is no corporate tax' is assumed by:

Answer & Solution

46. If a firm has no preference share capital, financial break-even level is defined as equal to:

Answer & Solution

47. If the closing balance of receivables is less than the opening balance for a month then which one is true out of:

Answer & Solution

48. Under the provisions of AS-19 'Leases', a leased asset is shown in the balance sheet of:

Answer & Solution

49. FL is zero if:

Answer & Solution

50. In stock dividend:

Answer & Solution

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41.
In case of Net Income Approach, the Cost of equity is:

42.
Cash Discount term 3/15, net 40 means:

43.
Which of the following is not a generally accepted approach for Calculation of Cost of Equity?

44.
The basic objective of Tandon Committee recommendations is that the dependence of industry on bank should gradually:

45.
'That there is no corporate tax' is assumed by:

46.
If a firm has no preference share capital, financial break-even level is defined as equal to:

47.
If the closing balance of receivables is less than the opening balance for a month then which one is true out of:

48.
Under the provisions of AS-19 'Leases', a leased asset is shown in the balance sheet of:

49.
FL is zero if:

50.
In stock dividend: