This quiz works best with JavaScript enabled. Home > Cbse > Class 12 > Commerce > Business Studies > Class 12 Business Studies Chapter 9 Financial Management – Quiz 36 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Class 12 Business Studies Chapter 9 Financial Management Quiz 36 (60 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. Key principles that financial managers use when making business decisions include A) Time value of money. B) Tradeoff between return and risk. C) Cash. D) All of the above. Show Answer Correct Answer: D) All of the above. 2. Assume that International Appliances has a current ratio of 1.2. Now, which of the following actions would improve (increase) this ratio? A) Collect some of the current accounts receivable. B) Purchase additional inventory on credit (accounts payable). C) Use cash to pay off some long-term debt. D) Use cash to pay off current liabilities. Show Answer Correct Answer: D) Use cash to pay off current liabilities. 3. The difference between present value of cash inflows and present value of cash outflows A) Gross present value. B) Capital. C) Net present value. D) None of these. Show Answer Correct Answer: C) Net present value. 4. Apakah perancangan kewangan yang berkesan dapat membantu individu mengelakkan? A) Pengumpulan hutang. B) Peluang pelaburan. C) Masalah kewangan. D) Pendapatan tinggi. Show Answer Correct Answer: C) Masalah kewangan. 5. The CFO helps maximize returns for A) Employees. B) Suppliers. C) Investors. D) Customers. Show Answer Correct Answer: C) Investors. 6. If a company follows labour intensive technique in production, they will go for less requirement of fixed capital. A) True. B) False. C) All the above. D) None of the above. Show Answer Correct Answer: A) True. 7. The partnership form of organization A) Avoids the double taxation of earnings and dividends found in the corporate form of organization. B) Usually provides limited liability to the partners. C) Has unlimited life. D) Simplifies decision making. Show Answer Correct Answer: B) Usually provides limited liability to the partners. 8. The traditional approach is also known as A) Ni approach. B) Mm approach. C) Intermediate approach. D) N o i approach. Show Answer Correct Answer: C) Intermediate approach. 9. Expense that can change from every to month A) Flexible expense. B) Fixed expense. C) Income. D) None of the above. Show Answer Correct Answer: A) Flexible expense. 10. The process of calculating future value of cash flows is known as A) Discounting. B) Compounding. C) Both of these. D) None of these. Show Answer Correct Answer: B) Compounding. 11. What is the principle that higher returns are associated with greater risks? A) Financial leverage. B) Budgeted income statement. C) Liquidity ratios. D) Risk-return trade-off. Show Answer Correct Answer: D) Risk-return trade-off. 12. Which of the following is LEAST likely to solve the agency problem between shareholders and managers? A) Giving managers profit-related rewards. B) Using external auditors to gauge company performance. C) Monitoring managers' actions. D) Writing restrictive covenants into loan note contracts. Show Answer Correct Answer: D) Writing restrictive covenants into loan note contracts. 13. If the company's current ratio is 5. If the company paid $ 100 of accounts payable using its cash. The new current ratio will A) Decrease. B) Increase. C) Be the same. D) Can not be determined. Show Answer Correct Answer: B) Increase. 14. The long-run objective of financial management is to ..... A) Maximize market share. B) Maximize the value of the firm's common stock. C) Maximize earnings per share. D) Maximize return on investment. Show Answer Correct Answer: B) Maximize the value of the firm's common stock. 15. What is one of the roles of fm in tax planning? A) Develop marketing campaigns to increase sales. B) Analyze customer behavior and preferences. C) Maximize deductions and credits to minimize tax liability. D) Manage the organization's investment portfolio. Show Answer Correct Answer: C) Maximize deductions and credits to minimize tax liability. 16. Which development most directly enabled currencies to adjust to market conditions after the Bretton Woods system ended? A) Fixed pegs were enforced by central banks. B) Capital controls were strengthened globally. C) Floating exchange rates were widely adopted. D) Gold convertibility was universally restored. Show Answer Correct Answer: C) Floating exchange rates were widely adopted. 17. Code that identifies your financial institution A) Routing number. B) Check number. C) Account number. D) Date. Show Answer Correct Answer: A) Routing number. 18. Which among the statement is not true for a debenture A) Long term loan finance. B) Interest on debenture is a tax deductible expense for the company. C) Fixed and regular source of income to the investor. D) None of these. Show Answer Correct Answer: D) None of these. 19. Which of the following financial goals does not meet the SMART concept? A) Save RM5 000 to bring parents on vacation to Japan. B) Save RM5 000 as registration fees of college after 2 years. C) Buy a new watch worth RM500 by next year. D) Save RM2 000 to buy video games by next year. Show Answer Correct Answer: A) Save RM5 000 to bring parents on vacation to Japan. 20. Saving money in a savings account is an example of a high-risk, high-return investment A) True. B) False. C) All the above. D) None of the above. Show Answer Correct Answer: B) False. 21. ..... is NOT a main category of financial management. A) Capital budgeting. B) Accounts payable management. C) Capital structure. D) Working capital management. Show Answer Correct Answer: B) Accounts payable management. 22. Family income means: A) Income of all related persons living in the household. B) Commodities and services produced in the country. C) Right to consume goods and services. D) All the above. Show Answer Correct Answer: A) Income of all related persons living in the household. 23. What are the functions of financial markets? A) Promote liquidity of physical assets. B) Provide professional investment advice. C) Facilitate access to short and long term funds. D) Allocate funds to non-productive units. Show Answer Correct Answer: C) Facilitate access to short and long term funds. 24. Apa yang dimaksud dengan istilah "finansial" berdasarkan materi yang disajikan? A) Segala hal yang berkaitan dengan pengelolaan keuangan untuk mencapai tujuan keuangan. B) Hanya mencakup investasi. C) Hanya mencakup manajemen risiko. D) Visi untuk mencapai tujuan keuangan. Show Answer Correct Answer: A) Segala hal yang berkaitan dengan pengelolaan keuangan untuk mencapai tujuan keuangan. 25. Redeemable preference shares can be redeemed out of A) The sale proceeds of investment. B) The proceeds of issue of debentures. C) The proceeds of a fresh issue of shares. D) Securities premium reserve. Show Answer Correct Answer: C) The proceeds of a fresh issue of shares. 26. What is the purpose of diversifying your investments? A) To maximize potential losses. B) To reduce risk by spreading investments across different assets. C) To keep all your money in one place. D) To avoid paying taxes. Show Answer Correct Answer: B) To reduce risk by spreading investments across different assets. 27. What caused Byju's financial statements to change and increase their losses? A) Lack of senior financial manager. B) Brand value declines. C) Investor lawsuits. D) Difficulty in paying interest. Show Answer Correct Answer: A) Lack of senior financial manager. 28. Forecast by analysts retention growth model and historical growth rates are methods used for an A) Estimate future growth. B) Estimate option present rate. C) Estimate growth ratio. D) Estimate option future rate. Show Answer Correct Answer: A) Estimate future growth. 29. What professional organization has the largest profit margin? A) NFL. B) WNBA. C) USTA. D) NBA. Show Answer Correct Answer: C) USTA. 30. Managing government revenues and expenditures falls under A) Corporate finance. B) Investment finance. C) Public finance. D) Personal finance. Show Answer Correct Answer: C) Public finance. 31. How do you calculate the cost of capital? A) Cost of Capital = (Re + Rd) / 2. B) Cost of Capital = (E/V * Re) + (D/V * Rd * (1-Tc)). C) Cost of Capital = (D/V * Rd) + (E/V * Re). D) Cost of Capital = (E * Re) + (D * Rd). Show Answer Correct Answer: B) Cost of Capital = (E/V * Re) + (D/V * Rd * (1-Tc)). 32. A share which gives you no right to claim dividends from years with no profit A) Redeemable Preference Share. B) Irredeemable preference Share. C) Cumulative preference share. D) Non-cumulative preference share. Show Answer Correct Answer: D) Non-cumulative preference share. 33. The investment involve decision making on daily basis. This sentence refer to ..... A) Capital investment. B) Working capital investment. C) All the above. D) None of the above. Show Answer Correct Answer: B) Working capital investment. 34. The furniture store offers you no-money-down on a new set of living room furniture. Further, you may pay for the furniture in three equal annual end-of-the-year payments of $ 1, 000 each with the first payment to be made one year from today. If the discount rate is 6%, what is the present value of the furniture payments? A) $ 2, 673.01. B) $ 2, 833.39. C) $ 2, 678.01. D) $ 3, 183.60. Show Answer Correct Answer: A) $ 2, 673.01. 35. What is the impact of the COVID-19 pandemic on financial markets? A) Positive economic growth. B) Stable financial markets. C) Increased rate of return on investments. D) 2020 stock market crash. Show Answer Correct Answer: D) 2020 stock market crash. 36. Cash flows are discounted for various reasons, but NOT because of A) Time. B) Inflation. C) Interest rate. D) Risk and uncertainty. Show Answer Correct Answer: D) Risk and uncertainty. 37. Double entry accounting means: A) A method where transactions are recorded only once. B) A system where every transaction affects at least two accounts. C) An accounting method that does not require balancing accounts. D) A system that tracks only cash transactions. Show Answer Correct Answer: B) A system where every transaction affects at least two accounts. 38. Money that a person owes to another person or bank/credit card company is ..... A) Checking. B) Credit. C) Debt. D) Investment. Show Answer Correct Answer: C) Debt. 39. Identify the function of stock exchange A) (a) Trading and settlement procedure. B) (b) Dematerialisation. C) C) Pricing of securities. D) (d) Depository participants. Show Answer Correct Answer: C) C) Pricing of securities. 40. A schedule of how much producers are willing and able to produce and sell at a price A) Profit. B) Services. C) Supply. D) Demand. Show Answer Correct Answer: C) Supply. 41. How does the time value of money affect investment decisions? A) The time value of money influences investment decisions by prioritizing present value and future cash flow potential. B) The time value of money is irrelevant for short-term investments. C) Investors only consider historical returns, ignoring future cash flows. D) The time value of money has no impact on investment decisions. Show Answer Correct Answer: A) The time value of money influences investment decisions by prioritizing present value and future cash flow potential. 42. ..... is the study of how money is used by individuals, societies and nations to meet people's needs. A) Debit. B) Income. C) Debt. D) Economics. Show Answer Correct Answer: D) Economics. 43. The market value of the firm is the result of A) Dividend decisions. B) Working capital decisions. C) Capital budgeting decisions. D) Trade-off between risk and return. Show Answer Correct Answer: D) Trade-off between risk and return. 44. Which of the following is NOT relevant to the use of the NPV method of investment appraisal? A) It relies on discounted cash flows. B) It's expressed as a percentage for easier comparison. C) Its value will fall if interest rates rise. D) A financially viable investment has a positive value. Show Answer Correct Answer: B) It's expressed as a percentage for easier comparison. 45. Increased EPS is the benefit of ..... A) Business valuation. B) Corporate account. C) Corporate restructuring. D) None of the above. Show Answer Correct Answer: C) Corporate restructuring. 46. Ratio untuk menilai kemampuan perusahaan dalam memenuhi seluruh kewajiban finansial dalam jangka pendek. Disebut apakah ratio tsb? A) Leverage ratio. B) Activity ratio. C) Financial ratio. D) Liquidity ratio. Show Answer Correct Answer: D) Liquidity ratio. 47. What is research A) Search. B) Again and again. C) Finding hidden facts. D) All of the above. Show Answer Correct Answer: D) All of the above. 48. What is the role of a financial advisor? A) To maximize debt accumulation. B) To provide guidance on financial decisions. C) To encourage reckless spending. D) To discourage saving. Show Answer Correct Answer: B) To provide guidance on financial decisions. 49. Is long-term vision and financial planning an important part of a financial manager's role? Why? A) No, because financial managers only focus on short-term financial goals. B) No, because financial planning is the responsibility of the accounting department. C) Yes, because it helps ensure the financial stability and growth of the organization. D) Yes, because finance managers are primarily responsible for forecasting sales and generating revenue. Show Answer Correct Answer: C) Yes, because it helps ensure the financial stability and growth of the organization. 50. The Theory underlying the cost of capital is primarily concerned with the cost of ..... A) Long-term funds and old funds. B) Short-term funds and new funds. C) Long-term funds and new funds. D) Short-term funds and old funds. Show Answer Correct Answer: C) Long-term funds and new funds. 51. Fixed capital finance depends on the short term sources of finance. A) True. B) False. C) All the above. D) None of the above. Show Answer Correct Answer: B) False. 52. Financial blueprint of operations A) Financial planning. B) Financial Management. C) All the above. D) None of the above. Show Answer Correct Answer: A) Financial planning. 53. Which branch of management does take care of the efficient planning and controlling of the financial activities of an organisation? A) Personnel management. B) Production management. C) Financial management. D) Marketing management. Show Answer Correct Answer: C) Financial management. 54. The expected return on a riskless asset is greater than zero due to A) An expected return for delaying consumption. B) Irrational investors who believe risk is always present. C) An expected return for taxes. D) An expected return for opportunity costs. Show Answer Correct Answer: A) An expected return for delaying consumption. 55. The following shows part of Mr Jason's financial management process.To save for emergency fundTo buy a laptopTo buy a terrace house in 10 years by paying RM60 000 as a down payment.What step in the financial management process did Mr Jason take? A) Evaluating financial status. B) Creating a financial plan. C) Carrying out financial plan. D) Setting financial goals. Show Answer Correct Answer: D) Setting financial goals. 56. Current liabilities are those that are except: A) For which the entity does not have the right at the end of the reporting period to defer settlement beyond 12 months. B) Held for purpose of trading. C) Expected to be settled within the entity's normal operating cycle. D) Due to be settled beyond 12 months. Show Answer Correct Answer: D) Due to be settled beyond 12 months. 57. What are the important financial aspects that an entrepreneur has to look after? A) Employee training programs. B) Marketing strategies. C) Product development timelines. D) Budgeting, cash flow management, financial forecasting, and investment decisions. Show Answer Correct Answer: D) Budgeting, cash flow management, financial forecasting, and investment decisions. 58. Chow plans to take out loan to buy a car. Which factor should he consider most to avoid future financial problems? A) Interest rate of the loan. B) Type of car being purchased. C) Loan term length. D) Monthly payment amount. Show Answer Correct Answer: A) Interest rate of the loan. 59. If Ke=r then what walter's model which of the following is irrelevant A) Earning per share. B) Dividend per share. C) DP ratio. D) None of the above. Show Answer Correct Answer: C) DP ratio. 60. Assets such as equipment and raw materials are referred to as: A) Financial assets. B) Securities. C) Real assets. D) Dividends. Show Answer Correct Answer: C) Real assets. ← PreviousNext →Related QuizzesCommerce QuizzesClass 12 QuizzesClass 12 Business Studies Chapter 9 Financial Management Quiz 1Class 12 Business Studies Chapter 9 Financial Management Quiz 2Class 12 Business Studies Chapter 9 Financial Management Quiz 3Class 12 Business Studies Chapter 9 Financial Management Quiz 4Class 12 Business Studies Chapter 9 Financial Management Quiz 5Class 12 Business Studies Chapter 9 Financial Management Quiz 6Class 12 Business Studies Chapter 9 Financial Management Quiz 7Class 12 Business Studies Chapter 9 Financial Management Quiz 8 🏠 Back to Homepage 📘 Download PDF Books 📕 Premium PDF Books