This quiz works best with JavaScript enabled. Home > Class 12 > Class 12 Business Studies Chapter 9 Financial Management – Quiz 99 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Class 12 Business Studies Chapter 9 Financial Management Quiz 99 (25 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. Permanent Working Capital means A) Funds that are temporarily locked in assets. B) Funds permanently locked in current assets to ensure smooth business operations. C) Funds used for investment in fixed assets. D) Excess funds available for long-term loans. Show Answer Correct Answer: B) Funds permanently locked in current assets to ensure smooth business operations. 2. ..... is financial institution. A) SEBI. B) Commercial bank. C) LIC. D) RBI. Show Answer Correct Answer: B) Commercial bank. 3. A cash budget is a plan for the amount expected to be spent and earned over a given period of time. A) True. B) False. C) All the above. D) None of the above. Show Answer Correct Answer: B) False. 4. For airlines, the most volatile and often largest single component of operating expenses is: A) Labor costs (Salaries and wages). B) Aircraft maintenance costs. C) Airport fees and landing charges. D) Fuel costs. Show Answer Correct Answer: D) Fuel costs. 5. What is the relationship between economic growth and standard of living? A) Economic growth decreases standard of living. B) No relationship. C) Economic growth only affects businesses. D) Economic growth improves standard of living. Show Answer Correct Answer: D) Economic growth improves standard of living. 6. Operating leverage helps in the analysis of ..... A) Business Risk. B) Financing Risk. C) Production Risk. D) Credit Risk. Show Answer Correct Answer: A) Business Risk. 7. What are the essential ingredients of sound working capital management? A) Efficient cash, inventory and receivables management. B) Efficient capital contribution and debtors management. C) Efficient creditors and debtors management. D) None of these. Show Answer Correct Answer: A) Efficient cash, inventory and receivables management. 8. Capital Structure is called ..... A) Quantitative aspect. B) Qualitative aspect. C) Both (a) and (b). D) None of these. Show Answer Correct Answer: B) Qualitative aspect. 9. Calculate Weighted Average cost of capital if company uses 40% debt and 60% equity for long term finance and debt is obtained at 15% and cost of equity is 20%. Assume tax rate as 50%. A) 17.5%. B) 15%. C) 20%. D) 18%. Show Answer Correct Answer: B) 15%. 10. Which of the following is considered a saving tool? A) Fixed Deposit. B) Credit Card. C) Loan. D) EMI. Show Answer Correct Answer: A) Fixed Deposit. 11. Dividend policy of a firm is governed by A) Long term financing Decision. B) Profit maximization decision. C) Wealth maximization decision. D) (a) and (c ). Show Answer Correct Answer: D) (a) and (c ). 12. What is the objective of financial planning related to determining capital requirements? A) To consider both short-term and long-term capital requirements. B) To only consider short-term capital requirements. C) To only consider long-term capital requirements. D) To ignore capital requirements. Show Answer Correct Answer: A) To consider both short-term and long-term capital requirements. 13. What is diversification in investment? A) Diversification is investing all funds in a single asset. B) Diversification is a strategy to reduce risk by allocating investments across different assets. C) Diversification is a method to maximize returns by concentrating investments in high-risk assets. D) Diversification means avoiding any investment in stocks. Show Answer Correct Answer: B) Diversification is a strategy to reduce risk by allocating investments across different assets. 14. Factors affecting financing decision is/are A) Cost. B) Risk. C) Cash flow position. D) All of the above. Show Answer Correct Answer: D) All of the above. 15. Decisions relating to purchase of Machinery is part of A) Capital Structure Decisions. B) Capital Budgeting Decisions. C) Dividend Decisions. D) Working Capital Management Decisions. Show Answer Correct Answer: B) Capital Budgeting Decisions. 16. Which of the following can be utilised for the redemption of preference shares of a company out of profit A) Share forfeited account. B) Dividend equalisation reserve. C) Capital redemption reserve account. D) Development rebate reserve account. Show Answer Correct Answer: B) Dividend equalisation reserve. 17. A Dependent is A) A taxpayer. B) A person who relies on another person for financial support. C) Your husband or wife. D) Your parent. Show Answer Correct Answer: B) A person who relies on another person for financial support. 18. Money that you make is called ..... A) Income. B) Variable expense. C) Propery taxes. D) Fixed expense. Show Answer Correct Answer: A) Income. 19. A prepaid expense is:(Year 2015) A) An asset. B) A liability. C) An expense. D) An income. Show Answer Correct Answer: A) An asset. 20. Sara worked an 8 hour shift and makes .12 per doll, she makes 80 dolls per hour, what was her gross pay for that day? A) $ 80.76. B) $ 76.80. C) $ 75.80. D) $ 60.00. Show Answer Correct Answer: B) $ 76.80. 21. BANK OVERDRAFT IS A FORM OF A) SHORT TERM FUNDS. B) LONG TERM FUNDS. C) BOTH. D) NONE OF THE ABOVE. Show Answer Correct Answer: A) SHORT TERM FUNDS. 22. Of the following, which is NOT one of the four main areas of finance? A) International finance. B) Corporate finance. C) All are considered main areas of finance. D) . Investments. Show Answer Correct Answer: C) All are considered main areas of finance. 23. Which one is not related with a government employee's personal benefit? A) GPF. B) Pension. C) Salary. D) Procurement. Show Answer Correct Answer: D) Procurement. 24. Q1) Basic objective of Financial Management is ..... A) Maximization of profit. B) Maximization of share holder's wealth. C) Ensuring Financial discipline in the firm. D) All of these. Show Answer Correct Answer: B) Maximization of share holder's wealth. 25. ..... are the debts owed to others. A) Liabilities. B) Owner's equity. C) Equity. D) Assets. Show Answer Correct Answer: A) Liabilities. ← 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