This quiz works best with JavaScript enabled. Home > Class 12 > Class 12 Business Studies Chapter 9 Financial Management – Quiz 5 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Class 12 Business Studies Chapter 9 Financial Management Quiz 5 (25 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. . When a company uses increased fixed cost for production, this is an example of what type of leverage A) Operating leverage. B) Financial leverage. C) Variable cost leverage. D) Combined leverage. Show Answer Correct Answer: A) Operating leverage. 2. What is zero-based budgeting? A) A system that requires a fixed percentage of income to be saved each month. B) Zero-based budgeting is a budgeting method that allocates every dollar of income to expenses, savings, or investments, ensuring total income minus total expenses equals zero. C) A budgeting approach that focuses solely on long-term investments. D) A method that only tracks expenses without considering income. Show Answer Correct Answer: B) Zero-based budgeting is a budgeting method that allocates every dollar of income to expenses, savings, or investments, ensuring total income minus total expenses equals zero. 3. What does the debt-to-equity ratio indicate? A) The debt-to-equity ratio indicates the relative proportion of shareholders' equity and debt used to finance a company's assets. B) It reflects the company's cash flow from operations. C) It indicates the total revenue generated by a company. D) It measures the company's market share in its industry. Show Answer Correct Answer: A) The debt-to-equity ratio indicates the relative proportion of shareholders' equity and debt used to finance a company's assets. 4. Offering cash discounts to customer results in ..... ? A) A. Reducing the average collection period. B) B. increasing sales. C) C. Increasing the average collection period. D) None of the above. Show Answer Correct Answer: A) A. Reducing the average collection period. 5. A ..... is a lease that transfers substantially all the risks and rewards incident to ownership of an asset. A) Operating lease. B) Finance lease. C) Open ended lease. D) Bipartitle lease. Show Answer Correct Answer: B) Finance lease. 6. The period between initial outlay and anticipated return is called A) Gestation period. B) Opportunity cost. C) Degree of risk. D) Long term investment. Show Answer Correct Answer: A) Gestation period. 7. Farish is a clerk with a monthly income of RM3500. He earns a passive income of RM550 every month with house rental. He spends RM2200 on fixed expenses and RM700 on variable expenses in a month. Calculate Farish's monthly cash flow. A) RM50. B) RM600. C) RM1150. D) RM1850. Show Answer Correct Answer: C) RM1150. 8. Karen makes $ 1, 000 a month working at Bojangles. She pays $ 450 in rent. How much money does she have per month after paying her rent? A) $ 500. B) $ 450. C) $ 550. D) None of the above. Show Answer Correct Answer: C) $ 550. 9. Cost of the Machinery is Rs 15, 00, 000. 20% down payment is required and balance is payable in 4 annual installments of Rs 4, 20, 000, 3, 90, 000, 3, 60, 000 and 3, 30, 000. Calculate the amount of interest. A) Rs 3, 00, 000. B) Rs 18, 00, 000. C) Rs 60, 000. D) Rs 15, 00, 000. Show Answer Correct Answer: A) Rs 3, 00, 000. 10. How do you Manage School Finances Effectively? A) Monitor data, public policy, and legislation continuously. B) Create a strategic three-to-five-year plan. C) Minimize unnecessary administrative costs. D) All of the above. Show Answer Correct Answer: D) All of the above. 11. Profit maximization focuses on which of the following? A) Reducing expenses without regard to revenue. B) Enhancing product quality at any cost. C) Increasing profit by maximizing revenue and minimizing costs. D) Focusing solely on increasing market share. Show Answer Correct Answer: C) Increasing profit by maximizing revenue and minimizing costs. 12. The appropriate objective of an enterprise is A) Maximization of sales. B) Maximization of profits. C) Maximization of cash. D) Maximization of owner's wealth. Show Answer Correct Answer: D) Maximization of owner's wealth. 13. Average net profit of the company is Rs 75, 000 and Average Capital employed is 9, 32, 500 and the normal rate of return is 8%. Calulate value of Goodwill at 5 year's purchase of super profit. A) Rs 74, 600. B) Rs 2, 98, 400. C) Rs 2, 000. D) Rs 4, 47, 600. Show Answer Correct Answer: C) Rs 2, 000. 14. What are some basic objectives of financial management training? A) To improve credit management skills. B) To develop financial planning skills. C) To increase profit margins. D) To reduce operational costs. Show Answer Correct Answer: B) To develop financial planning skills. 15. When people buy property and agree to pay for it later, they are buying on ..... A) Credit. B) Debit. C) All the above. D) None of the above. Show Answer Correct Answer: A) Credit. 16. The primary goal of a publicly owned firm is ..... A) To maximize the expected net profit. B) To maximize the dividends per share. C) To maximize the stock price per share. D) To maximize the expected total corporate profit. Show Answer Correct Answer: C) To maximize the stock price per share. 17. The most liquid of all assets, cash, appears on the first line of the balance sheet. A) Cash and Equivalents. B) Accounts Receivable. C) Inventory. D) Intangible Assets. Show Answer Correct Answer: A) Cash and Equivalents. 18. Which of the following is NOT a step in the corporate planning process? A) Environmental analysis. B) Implementation of tactical plans. C) Employee training. D) Determination of objectives. Show Answer Correct Answer: C) Employee training. 19. How does a higher times interest earned ratio impact a company's risk of default on its debt obligations? A) Increases the risk of default. B) Reduces the risk of default. C) Indicates lower profitability. D) Implies higher financial leverage. Show Answer Correct Answer: B) Reduces the risk of default. 20. Penjualan dengan credit akan masuk di P/L sebagai 'revenue/pemasukan' dan masuk di Balance Sheet (Neraca) sebagai apa? A) Account receivable profitability. B) Long-term assets. C) Short-term liability. D) Operating Cash Flow. Show Answer Correct Answer: A) Account receivable profitability. 21. The decisions relating to the use of profits or income of an entity or organization are known A) Finance decisions. B) Dividend decisions. C) Investment Decision. D) Any of these. Show Answer Correct Answer: B) Dividend decisions. 22. Dividend can be distributed in which all forms A) Cash dividend. B) Stock dividend (Bonus shares). C) Both (a) and (b). D) None of these. Show Answer Correct Answer: C) Both (a) and (b). 23. The inability of a business to meet its fixed financial obligations, like payment of interest, is known as A) Business risk. B) Financial risk. C) Long-term risk. D) Market risk. Show Answer Correct Answer: B) Financial risk. 24. What do you need to do within the process of evaluating financial statues? A) Evaluate assets owned. B) Evaluate assets owned and liabilities borne. C) Check savings and investments owned. D) Check credit cards debts. Show Answer Correct Answer: B) Evaluate assets owned and liabilities borne. 25. Which of the following is an example of a financing decision? A) Issuing new shares. B) Declaring dividends. C) Purchasing machinery. D) Preparing payroll. Show Answer Correct Answer: A) Issuing new shares. ← PreviousNext →Related 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 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 9Class 12 Business Studies Chapter 9 Financial Management Quiz 10Class 12 Business Studies Chapter 9 Financial Management Quiz 11 🏠 Back to Homepage 📘 Download PDF Books 📕 Premium PDF Books