This quiz works best with JavaScript enabled. Home > Class 12 > Class 12 Business Studies Chapter 9 Financial Management – Quiz 90 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Class 12 Business Studies Chapter 9 Financial Management Quiz 90 (25 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. Assets such as equipment and raw materials are referred to as: A) Dividends. B) Securities. C) Financial assets. D) Real assets. Show Answer Correct Answer: D) Real assets. 2. Dividend is that part of profit after tax which is ..... to the ..... of the company A) Retained, shareholders. B) Distributed, company. C) Distributed, Shareholders. D) None of these. Show Answer Correct Answer: C) Distributed, Shareholders. 3. Financing Decisions are known as A) Capital Structure Decisions. B) Capital Budgeting Decisions. C) Dividend Decisions. D) Working Capital Management Decisions. Show Answer Correct Answer: A) Capital Structure Decisions. 4. Which of the following identities is FALSE? A) Change in Equity = Paid-in-Surplus-Net New Borrowing from Creditors. B) Net New Borrowing = Ending Long-term Liabilities-Beginning Long-Term Liabilities. C) Cash Flow to Owners = Dividends-Net New Borrowing from Owners. D) Net New Borrowing from Owners = Change in Equity. Show Answer Correct Answer: A) Change in Equity = Paid-in-Surplus-Net New Borrowing from Creditors. 5. Identification of investment proposals is the first step in capital budgeting process A) True. B) False. C) All the above. D) None of the above. Show Answer Correct Answer: A) True. 6. Which financial decision help a businessman in opening a new branch of its business. A) Financing decision. B) Dividend decision. C) Investment decision. D) None of the above. Show Answer Correct Answer: C) Investment decision. 7. In case of increasing price, stock is valued at higher value in which of the following methods A) LIFO. B) FIFO. C) All the above. D) None of the above. Show Answer Correct Answer: B) FIFO. 8. If the degree of operating leverage is 1.5 and the degree of combined leverage is 3.5 then whats is the degree of financial leverage? A) 1.75. B) 2.00. C) 2.33. D) 5.00. Show Answer Correct Answer: C) 2.33. 9. Equity financing designed specially for funding start ups and high technology projects A) Seed capital. B) Bridge finance. C) Venture capital. D) Forfaiting. Show Answer Correct Answer: C) Venture capital. 10. Decision criterion with respect to profitability index to accept project is? A) Profitability index is equal to or less than 1. B) Profitability index is greater than 1. C) Profitability index is greater than or equal to 1. D) Profitability index is less than 1. Show Answer Correct Answer: C) Profitability index is greater than or equal to 1. 11. The meaning of capital structure relates to the percentage of ..... sources. A) Long-term. B) Medium term. C) Short-term. D) Current. Show Answer Correct Answer: A) Long-term. 12. Financial risk is analysed with the help of A) Operating leverage. B) Financial leverage. C) Combined leverage. D) All of above. Show Answer Correct Answer: B) Financial leverage. 13. Non-spontaneous financing can be divided into: A) Security loan and permanent loan. B) Temporary loan and permanent loan. C) Secured loan and unsecured loan. D) Long-term loan and immediate loan. Show Answer Correct Answer: C) Secured loan and unsecured loan. 14. Finance is only concerned with accounting records A) True. B) False. C) All the above. D) None of the above. Show Answer Correct Answer: B) False. 15. Why is cash flow management critical for a business? A) It helps the business reduce its product prices. B) It ensures the business can meet its short-term obligations and avoid insolvency. C) It helps with advertising. D) It ensures employee satisfaction. Show Answer Correct Answer: B) It ensures the business can meet its short-term obligations and avoid insolvency. 16. Which of the following is not a factor affecting financing decision? A) Floatation Cost. B) Risk. C) Rate of return. D) Cash flow position. Show Answer Correct Answer: C) Rate of return. 17. Which of the following is NOT a major area of finance? A) Corporate finance. B) Personal finance. C) Human resource finance. D) Public finance. Show Answer Correct Answer: C) Human resource finance. 18. It is a kind of security issued by a company to raise funds with the expectation of receiving dividends in the future A) Capital stock. B) Stock dividends. C) Bonds. D) Answer not given. Show Answer Correct Answer: A) Capital stock. 19. If return on investment is less than the rate of interest, then company must prefer A) (a) Equity. B) (b) Debt. C) C) Both (a) and (b). D) (d) None of the above. Show Answer Correct Answer: A) (a) Equity. 20. The financial management is generally concerned with procurement, allocation and control of financial resources of a concern. A) TRUE. B) FALSE. C) All the above. D) None of the above. Show Answer Correct Answer: A) TRUE. 21. Due to globalization, the financial management function has become ..... A) Less demanding and complex. B) More demanding and complex. C) Less important and complex. D) Outdated and complex. Show Answer Correct Answer: B) More demanding and complex. 22. A budget helps prioritize needs over wants A) True. B) False. C) All the above. D) None of the above. Show Answer Correct Answer: A) True. 23. The nature of financial management is BEST described as: A) A short-term operational activity. B) A long-term strategic decision-making process. C) A routine administrative task. D) A legal compliance procedure. Show Answer Correct Answer: B) A long-term strategic decision-making process. 24. Jackson spends in gas changes every month, based upon the price of gas, this is an example of which of the following: A) Fixed Expense. B) Variable Expense. C) Periodic Expense. D) None of the above. Show Answer Correct Answer: B) Variable Expense. 25. Because of globalization in the world's markets, a multinational financial manager is more likely than a domestic financial manager to specialize in finance to the exclusion of other fields of business. A) True. B) False. C) All the above. D) None of the above. Show Answer Correct Answer: B) False. ← 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 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 9Class 12 Business Studies Chapter 9 Financial Management Quiz 10 🏠 Back to Homepage 📘 Download PDF Books 📕 Premium PDF Books