This quiz works best with JavaScript enabled. Home > Cbse > Class 12 > Commerce > Business Studies > Class 12 Business Studies Chapter 9 Financial Management – Quiz 4 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Class 12 Business Studies Chapter 9 Financial Management Quiz 4 (60 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. If you invest $ 100, 000 today at 12% interest rate for one year, what is the amount you will have at the end of the year? A) $ 90, 909. B) $ 112, 000. C) $ 100, 000. D) None of the above. Show Answer Correct Answer: B) $ 112, 000. 2. If firm has ke>r the walters model suggest for A) 100% payout. B) 25% payout less than. C) 0% payout. D) 50% payout. Show Answer Correct Answer: A) 100% payout. 3. The time value of money concept recognizes that: A) Money today is worth more than the same amount in the future. B) Money in the future is worth more than the same amount today. C) The value of money is constant over time. D) The value of money is determined by inflation. E) None of the above. Show Answer Correct Answer: A) Money today is worth more than the same amount in the future. 4. Double-entry accounting ensures that: A) Each transaction affects only one account. B) Businesses report weekly profit. C) Revenue is recorded only when cash is received. D) Each transaction is recorded in at least two accounts. Show Answer Correct Answer: D) Each transaction is recorded in at least two accounts. 5. Its failure to consider changes in the purchasing power of currencies. A) TRUE. B) FALSE. C) All the above. D) None of the above. Show Answer Correct Answer: A) TRUE. 6. What is the purpose of distributing value through dividends or share buybacks? A) Minimize cash flow. B) Maximize debt. C) Reduce capital structure. D) Reward Shareholders. Show Answer Correct Answer: D) Reward Shareholders. 7. What are the financial objectives of a business? A) Profitability, Liquidity, Solvency, Growth and Efficiency. B) Profit and Growth. C) Profitability, Solvency, Efficiency and Growth. D) Growth, Profit, Efficiency and Income. Show Answer Correct Answer: A) Profitability, Liquidity, Solvency, Growth and Efficiency. 8. All food expenses are carried out from the money in envelope/ food purse wallet. This is helpful for which form the below: A) Mechanical checks. B) Keeping record. C) Mental Checks. D) Option b & c. Show Answer Correct Answer: A) Mechanical checks. 9. Cash & Cash Equivalent-24, 890Held for Trading-10, 000Trade and Other Receivables-16, 000Inventory-8, 960If total current liabilities amounted to 19, 900, Net Sales for the present year amounted to 480, 000 and the ending receivables totaled to 16, 500. However, it was found out that the ending inventory amounted to 9, 500 and the Cost of Goods Sold totaled to 364, 000. What is the average sale period? A) 9 days. B) 11 days. C) 10 days. D) 12 days. Show Answer Correct Answer: A) 9 days. 10. Which of the following is a secondary objective of financial management? A) Ensuring adequate funds are available. B) Maximizing shareholder wealth. C) Ensuring maximum profitability. D) Ensuring business survival and growth. Show Answer Correct Answer: D) Ensuring business survival and growth. 11. The financial metric calculated as Total Operating Expenses divided by Available Seat Miles (ASMs) is known as: A) Yield. B) Load Factor (LF). C) PRASM (Passenger Revenue per Available Seat Mile). D) CASM (Cost per Available Seat Mile). Show Answer Correct Answer: D) CASM (Cost per Available Seat Mile). 12. Which of the following is not a financial goal? A) Genting promotion. B) Buying a vacumm cleaner. C) Chlid's education fund. D) Paying down payment for house. Show Answer Correct Answer: A) Genting promotion. 13. Investing in government bonds is an example of a high-risk investment A) True. B) False. C) All the above. D) None of the above. Show Answer Correct Answer: B) False. 14. What is the role of financial manager in relation to allocation of funds? A) To allocate funds in such a manner that they are optimally used. B) To allocate funds randomly without any plan. C) To not allocate any funds. D) To allocate all funds to a single project. Show Answer Correct Answer: A) To allocate funds in such a manner that they are optimally used. 15. Elliott works two jobs, the first he worked 7 hours and makes $ 24.25 and hour, the second he worked 5 hours and makes $ 18.50, what was his total gross pay for that day? A) $ 262.25. B) $ 265.00. C) $ 169.75. D) $ 200.50. Show Answer Correct Answer: A) $ 262.25. 16. Financial management primarily deals with the A) Management of marketing activities. B) Management of production. C) Management of flow of funds. D) Management of employees. Show Answer Correct Answer: C) Management of flow of funds. 17. .... is the advantage to a comapny gained by merging existing resources with another company's resources. A) Amalgamation. B) Acquisition. C) Synergy. D) Consolidation. Show Answer Correct Answer: C) Synergy. 18. The sum of short term and long term sources of finance is known as: A) Capital structure. B) Both of these. C) Financial structure. D) None of these. Show Answer Correct Answer: C) Financial structure. 19. What is a summary of your financial history called? A) Taxes. B) Credit report. C) Loan. D) Credit score. Show Answer Correct Answer: B) Credit report. 20. Correct cost of capital helps in the following decision making: A) Evaluation of Investment options. B) Financing Decision. C) Designing of optimum credit policy. D) All the three. Show Answer Correct Answer: D) All the three. 21. Current assets include A) Land. B) Building. C) Inventory. D) Furniture. Show Answer Correct Answer: C) Inventory. 22. What is the annual interest rate mentioned for the credit card example? A) 10%. B) 20%. C) 15%. D) 18%. Show Answer Correct Answer: D) 18%. 23. What is the importance of financial planning related to maintaining financial stability? A) By keeping a fair balance between outflow and inflow of cash. B) By keeping a high outflow of cash and a low inflow of cash. C) By increasing the outflow of cash and decreasing the inflow of cash. D) By decreasing the outflow of cash and increasing the inflow of cash. Show Answer Correct Answer: A) By keeping a fair balance between outflow and inflow of cash. 24. Shadowline Co has a money cost of capital of 10%. If inflation is 4%, what is Shadowline Co's real cost of capital? (to one decimal place)? A) 5.9%. B) 5.7%. C) 5.5%. D) 5.8%. Show Answer Correct Answer: D) 5.8%. 25. What is the primary purpose of a Budget? A) To estimate income and expenses over a specific time period. B) To determine creditworthiness. C) To calculate taxes. D) To list all assets. Show Answer Correct Answer: A) To estimate income and expenses over a specific time period. 26. If a family's monthly expenses are greater than its income, then it has: A) Interest. B) A debt. C) Savings. D) Income. Show Answer Correct Answer: B) A debt. 27. A company has calculated the NPV of a new project as follows:Present value($ '000)Sales revenue 4, 000Variable costs (2, 000)Fixed costs (500)Corporation tax at 20% (300)Initial outlay (1, 000)NPV 200What is the sensitivity of the project decision to a change in sales volume? A) 12.5%. B) 10.0%. C) 5.0%. D) 6.3%. Show Answer Correct Answer: A) 12.5%. 28. What is the definition of finance? A) The study of how to maximize allocate assets. B) The management of government revenue, expenditure, and debt. C) The management of an individual's finances. D) The creation and study of money and investments. Show Answer Correct Answer: A) The study of how to maximize allocate assets. 29. Financial structure refers to ..... A) Short-term resources. B) All the financial resources. C) Long-term resources. D) All of these. Show Answer Correct Answer: B) All the financial resources. 30. What is a credit score? A) A small plastic card that lets you make a purchase without cash. B) How much money you make compared to how much money you owe?. C) A number that helps a lender predict how likely an individual is to repay a loan. D) None of the above. Show Answer Correct Answer: C) A number that helps a lender predict how likely an individual is to repay a loan. 31. Stocks are bought and sold in ..... markets. A) Foreign exchange. B) Debt. C) Equity. D) Derivatives. Show Answer Correct Answer: C) Equity. 32. Debt causes a dilution of control A) True. B) False. C) All the above. D) None of the above. Show Answer Correct Answer: B) False. 33. Also known as balance sheet, balance sheet or statement of equity, it is a financial statement that reflects at a given time the economic and financial information of a company, separated into three assets:assets, liabilities and net worth. A) Cost effectiveness. B) Cash flow. C) Statement of income. D) Balance sheet. Show Answer Correct Answer: D) Balance sheet. 34. Having ALOT of money means you are important A) True. B) False. C) All the above. D) None of the above. Show Answer Correct Answer: B) False. 35. Wealth maximization as the goal of the firm implies enhancing the wealth of A) The firm's employees. B) The government. C) The Board of Directors. D) The firm's shareholders. Show Answer Correct Answer: D) The firm's shareholders. 36. Which feature illustrates the free flow of capital and trade? A) Complete ban on international money transfers. B) Foreign direct investment moving across borders. C) Subsidies replacing tariffs in all countries. D) Strict quotas limiting imports and exports. Show Answer Correct Answer: B) Foreign direct investment moving across borders. 37. Which of the following represents the key financial decision areas in corporate finance? A) Capital budgeting, financial analysis, and marketing strategies. B) Capital budgeting, financing decisions, and working capital management. C) Human resource management, capital budgeting, and financial planning. D) Financial analysis, risk management, and dividend policy. Show Answer Correct Answer: B) Capital budgeting, financing decisions, and working capital management. 38. Financial leverage refers to the portion of debt in the overall capital. A) True. B) False. C) All the above. D) None of the above. Show Answer Correct Answer: A) True. 39. Which of the following is an active income? A) Commission. B) House rental. C) Interest. D) Dividend. Show Answer Correct Answer: A) Commission. 40. Airports typically have a business model characterized by: A) Low fixed costs and high variable costs. B) High fixed costs and the need to achieve economies of scale. C) Short-term planning horizons due to flexible capacity. D) High profitability regardless of passenger traffic. Show Answer Correct Answer: B) High fixed costs and the need to achieve economies of scale. 41. ..... used to compare different firms at the same point in time. A) Combined analysis. B) Cross-sectional analysis. C) Industry comparative analysis. D) Trend analysis. Show Answer Correct Answer: B) Cross-sectional analysis. 42. Cash flow management: A) Ensures adequate liquidity to meet short-term obligations. B) Manages working capital. C) Invests surplus funds effectively. D) All of the above. Show Answer Correct Answer: A) Ensures adequate liquidity to meet short-term obligations. 43. ..... type of financing is usually done for financing high risky businesses A) Veture capital. B) Factoring. C) Leasing. D) Hire purchase. Show Answer Correct Answer: A) Veture capital. 44. The amount of money left after all deductions have been taken from the gross pay earned in a pay period is called? A) Gross pay. B) Net pay. C) Overtime pay. D) Pay period. Show Answer Correct Answer: B) Net pay. 45. This type of loan allows customers to borrow money up to a certain limit against the security of the commodity. A) Overdraft. B) Trade Credit. C) Cash Credit. D) None of the above. Show Answer Correct Answer: C) Cash Credit. 46. Identifies your individual account A) Check number. B) Routing number. C) Account number. D) Date. Show Answer Correct Answer: C) Account number. 47. What is the main goal of finance A) Tracking tax payments. B) Managing raw materials. C) Managing money and resources over time. D) Calculating inventory volumes. Show Answer Correct Answer: C) Managing money and resources over time. 48. What is a common strategy to improve cash flow? A) Implementing efficient billing practices. B) Offering longer credit terms. C) Delaying invoice payments. D) Increasing inventory levels. Show Answer Correct Answer: A) Implementing efficient billing practices. 49. All financial transactions have a buyer and a seller. A) TRUE. B) FALSE. C) All the above. D) None of the above. Show Answer Correct Answer: A) TRUE. 50. The finance manager has to take decision with regards to the net profit distribution. A) Dividend Decision. B) Financial Decision. C) All the above. D) None of the above. Show Answer Correct Answer: A) Dividend Decision. 51. Which of the following is a sign that a company is failing to maximise shareholder wealth? A) Management has challenging performance bonuses. B) Investment decisions are evaluated on the basis of their net present value. C) The company has not diversified its operations. D) Financing of the company is via equity finance alone. Show Answer Correct Answer: D) Financing of the company is via equity finance alone. 52. "Shareholder wealth" in a firm is represented by: A) The number of people employed in the firm. B) The amount of salary paid to its employees. C) The market price per share of the firm's common stock. D) The book value of the firm's assets less the book value of its liabilities. Show Answer Correct Answer: C) The market price per share of the firm's common stock. 53. Syarat diterimanya suatu investasi A) IRR lebih besar dari rate acuan. B) Profitability Index lebih besar dari pada 1. C) NPV Positif. D) Semua jawaban sebelumnya benar. Show Answer Correct Answer: D) Semua jawaban sebelumnya benar. 54. Easy access to capital market allows firms to give more dividend. A) True. B) False. C) All the above. D) None of the above. Show Answer Correct Answer: A) True. 55. Sales Returns and Allowances A) Debit. B) Credit. C) All the above. D) None of the above. Show Answer Correct Answer: A) Debit. 56. Management accounts are always shared with the public A) True. B) False. C) All the above. D) None of the above. Show Answer Correct Answer: B) False. 57. ..... is the present value of an asset less all claims against it. A) Property. B) Equity. C) Asset. D) Capital. Show Answer Correct Answer: B) Equity. 58. Put money from in your savings account every month so you can afford future costs A) Pay yourself first philosophy. B) Put it in savings philosophy. C) Think to the future philosophy. D) None of the above. Show Answer Correct Answer: A) Pay yourself first philosophy. 59. What is the total amount left for savings in the sample budget? A) $ 400. B) $ 300. C) $ 200. D) $ 500. Show Answer Correct Answer: A) $ 400. 60. Equity shares represent: A) Loss. B) Debt. C) Ownership in company. D) Liability. Show Answer Correct Answer: C) Ownership in company. ← 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 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 8Class 12 Business Studies Chapter 9 Financial Management Quiz 9 🏠 Back to Homepage 📘 Download PDF Books 📕 Premium PDF Books