FINANCIAL MANAGEMENT

FINANCIAL MANAGEMENT

LIST OF ATTEMPTED NEW PATTREN QUESTIONS AND ANSWERS -2010-11

1) Question - Registered Debenture are those

Correct Answer – Which can be transferred to another person only through the company.

2) Question – Indicate which of these are profitability ratio

Correct Answer – Operating ratio , Gross profit ratio

3) Question – The most important decisions regarding the amount to be invested in fixed assets is technically referred to as

Correct Answer – Capital budgeting

4) Question – If the customer fails to pay the amount due from him the legal action should be initiated against the customer after the limitation period is over.

Correct Answer – TRUE

5) Question – The evaluation of various proposal of capital expenditure should be done as rationally as possible.

Correct Answer – TRUE

6) Question – Goods stolen (Sales price Rs.-1000/- Cost Rs.800/-); which of the account will be effected by this transition

Correct Answer – Purchases Account, Loss by thief Account

7) Question – Capital Cost is

Corrects Answer – Cost on the use of additional capital to support credit sales

8) Question – The factor make the prepayment of the invoice to the selling company after keeping the __________ as stipulated.

Corrects Answer – Margin

9) Question – To meet the working capital needs of the company, bank may grant the working capital terms loans for a period of ___________ .

Corrects Answer – 3 to 7 years

10) Question – The advantage of leasing for the lessee are

Corrects Answer – It is the quickest method of financing the requirements of long terms capital, Avoids risk of ownership

11) Question – From the following data compute minimum level : Normal usage 40 units per week each ,Minimum usage 15 units per week each , Maximum usage 65 units per week each , Re-order quantity 400 units, Re-order period 4 to 6 weeks

Corrects Answer – 190 units

12) Question – The amount of shares bought back by the company should be more then __________ of total paid-up capital of the company and its free reserves.

Corrects Answer – 25%

13) Question –                             Corrects Answer

A ) Unclaimed dividend                 Current liabilities

B ) Risk Capital                                Equity Capital

C) Loose tools                                  Current assets

D ) Legal charges                             miscellaneous expenditure

14) Question – Operating leverage is calculated as earning before interest and tax / (Earnings before interest Tax – Interest)

Corrects Answer – FALSE