Financial Management Online MCQ Practice Set

Question: ‘Bird in hand’ argument is given by

Answer option

• A. Walker’s Model
• B. Gordon’s Model
• C. MM Mode
• D. Residuals Theory

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Question: ‘Constant Dividend Per Share’ Policy is considered as:

Answer option

• A. Increasing Dividend Policy
• B. Decreasing Dividend Policy
• C. Stable Dividend Policy
• D. None of the above

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Question: ‘Judicious use of leverage’ is suggested by:

Answer option

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

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Question: ‘That personal leverage can replace corporate leverage’ is assumed by:

Answer option

• A. Traditional Approach
• B. MM Model
• C. Net Income Approach
• D. Net Operating Income Approach

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Question: ‘That there is no corporate tax’ is assumed by:

Answer option

• A. Net Income Approach
• B. Net Operating Income Approach
• C. Traditional Approach
• D. All of these

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Question: “A debenture is a document which either creates a debt or acknowledge it”. who said?

• A. Justice Chitty
• B. Tophan’s Company law
• C. J. Betty
• D. Hoston D

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Question: “Capital budgeting is long term planning for making and financing proposed capital outlays”. Who said?

• A. Charles T. Horngreen
• B. Philippatos
• C. J Betty
• D. Lynch

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Question: “Shareholders Wealth” in a firm is reflected by:</

• A. the number of people employed in the firm
• B. the book value of the firm’s assets less the book value of its liabilities
• C. the amount of salary paid to its employees
• D. the market price per share of the firm

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Question: 1,00,000; 10% Debentures of Rs. 100 each of company, the interest payable for quarter is:

• A. Rs. 10,00,000
• B. Rs. 2,50,000
• C. Rs. 5,00,000
• D. None of these

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Question: 5Cs of the credit does not include

Answer option

• A. Collateral
• B. Character
• C. Conditions
• D. None of the above

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Question: 80% of sales of 10,00,000 of a firm are on credit. It has a Receivable Turnover of 8.What is the Average collection period (360 days a year) and Average Debtors of the firm?

Answer option

• A. 45 days and 1,00,000
• B. 360 days and 1,00,000
• C. 45 days and 8,00,000
• D. 360 days and 1,25,000

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Exam Question

A cash discount may best be defined as

• 1) a reduction in price if payment is made within the specified time period
• 2) a discount offered to critical suppliers
• 3) a discount applied to volume sales
• 4) a discount or the repayment of the firm’s debt

Practice set and Exam Quiz

Yes! You can do Online MCQ practice of Financial Management question set and give online exam quiz test for Financial Management, so you can check your knowledge. You can get MCQ Study and Exam link from home page.

Exam Question

A collection center

• 1) involves using geographically disbursed centers to collect from non-paying customers
• 2) utilizes local banks to clear local payments made to the collection center
• 3) is lower in cost to the firm than a lockbox system
• 4) results in checks being forwarded to a P.O. box and clearing through local bank branches

Practice set and Exam Quiz

Yes! You can do Online MCQ practice of Financial Management question set and give online exam quiz test for Financial Management, so you can check your knowledge. You can get MCQ Study and Exam link from home page.

Question: A company can increase its value and reduce the overall cost of capital by increasing the proportion of debt in its capital structure according to___approach

• A. Net income approach
• B. Net operating income approach
• C. Traditional approach
• D. None of these

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Question: A company has earnings before interest and taxes of Rs1,00,000. It expects a return on Investment at a rate of 12.5%. What is the total value of the firm according to MM Theory?

Answer option

• A. Rs6,00,000
• B. Rs7,00,000
• C. Rs8,00,000
• D. Rs9,00,000

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Question: A company may raise funds by issue of shares or___

• A. By borrowings
• B. By sales of goods
• C. By sale of assets
• D. By sale of services

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Question: A company should arrange the capital structure in such a way that there is maximum flexibility in the capital and cost of capital is

• A. Maximum
• B. Minimum
• C. Expensive
• D. All of the above

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Question: A company should follow the policy of___gear during deflation or depression period

• A. High gear
• B. Low gear
• C. Medium gear
• D. Any of the above

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Question: A company should follow the policy of___gear during inflation or boom period

• A. High gear
• B. Low gear
• C. Medium gear
• D. Any of the above

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Exam Question

A convertible security is

• 1) convertible into cash at the option of the holder
• 2) a bond or share of preferred, convertible into common at the firm’s option
• 3) a bond or share of preferred, convertible into common at the holders’ option
• 4) a security convertible into a debenture at the holder’s option

Practice set and Exam Quiz

Yes! You can do Online MCQ practice of Financial Management question set and give online exam quiz test for Financial Management, so you can check your knowledge. You can get MCQ Study and Exam link from home page.