Which one of the following is related to planning, organising, directing and controlling of financial activities?
  • Financial decision
  • Capital structure
  • Investment decision
  • Financial management
Wealth maximisation depends on
  • market price per share.
  • market price of finished good.
  • market price of inventory.
  • market price of fixed assets.
Investment decision involves
  • investment in fixed assets.
  • investment in current assets.
  • investment in fixed and current assets.
  • investment in Government securities.
If dividend portion of total earnings is high, portion of retained earnings will be
  • high.
  • low.
  • moderate.
  • equal.
Financial procedures are determined by
  • financial planning.
  • financial leverage.
  • financial decisions.
  • capital structure.
Capital structure shows
  • Debtor-creditor ratio.
  • Fixed assets-current assets ratio.
  • Debt-equity ratio.
  • Interest coverage ratio.
Fixed capital requirements are determined by
  • nature of business.
  • nature of business environment.
  • nature of Government control.
  • nature of marketing efforts.
Working capital requirements are low when an organisation has
  • high technology.
  • high debtors.
  • high inventory.
  • high creditors.
___ is concerned with optimum procurement as well as usage of finance.
  • Financial Analysis
  • Financial Planning
  • Financial Management
  • Budgeting
___ represents investment in current assets required for day-to-day operations of the business.
  • Long-term capital
  • Working capital
  • Capital Budgeting
  • Medium-term capital
___ involves increasing the proportion of debt and preference shares in total capital.
  • Trading on equity
  • Capital Budgeting
  • Financing decision
  • Financial Analysis
___ is the time span between acquisition of goods and realisation of sale proceeds.
  • Working capital
  • Payback Period
  • Operating Cycle
  • Account Receivables Period
___ Gross working capital represents the total investment in assets.
  • Current
  • Fixed
  • Tangible
  • Intangible
___ capital refers to investment in long-term assets.
  • Fixed
  • Variable
  • Working
  • Both (b) and (c)
The working capital requirement of a business is not likely to be high when?
  • The nature of business is trading
  • Scale of operation of business is small
  • It is difficult to procure raw material
  • The rate of inflation is low
Under which of the following circumstances the fixed capital requirement of a business is not likely to be high?
  • When the raw material is not easily available
  • Capital intensive techniques of production are used
  • The growth prospects of a company a high
  • When the financial alternatives are easily available
Which of the following statements is not true with regard to use of fixed capital?
  • It affects the long term growth of the business.
  • Large amount of funds are involved.
  • The business risk involved is low.
  • The investment decisions are irreversible.
Under which of the following situations a company is not likely to issue equity capital?
  • When the debt service coverage ratio is high.
  • When the interest coverage ratio is high.
  • When the cost of debt capital is low.
  • All of the above
If the rate of return on investment for a company is 16%, a situation of unfavourable financial leverage will be said to arise when the rate of interest payable on debt capital is
  • More than 16 %
  • Less than 16 %
  • Equal to 16%
  • None of the above
The total capital of Uranium Private Limited is ?50 lacs. The amount of debt is ?20 lacs. The company has earned a profit of ^10 lacs during the current financial year. Its return on investment (ROI) for the present year is
  • 20%
  • 40%
  • 10%
  • 80%
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