Financial management Archives - Page 4 of 112 - MCQ and Quiz for Exams

31. Present value of future cash flows is divided by an initial cost of project to calculate

negative index

exchange index

project index

profitability index

Detailed SolutionPresent value of future cash flows is divided by an initial cost of project to calculate

32. Re-order level is ____________than safety level.

higher

lower

medium

fixed

Detailed SolutionRe-order level is ____________than safety level.

33. Basic objective of diversification is:

Increasing Return

Maximising Return

Decreasing Risk

Maximizing Risk

Detailed SolutionBasic objective of diversification is:

34. Under trading means.

Having low amount of working capital

High turnover of working capital

Sales are less compared to assets employed

Low turnover of working capital

Detailed SolutionUnder trading means.

35. Trading on Equity is:

Always beneficial

May be beneficial

Never beneficial

None of the above

Detailed SolutionTrading on Equity is:

36. Cash flow which starts negative then positive than again positive cash flow is classified as

normal costs

non-normal costs

non-normal cash flow

normal cash flow

Detailed SolutionCash flow which starts negative then positive than again positive cash flow is classified as

37. Which of the following is a measure of Debt Service capacity of a firm?

Current Ratio

Acid Test Ratio

Interest Coverage Ratio

Debtors Turnover

Detailed SolutionWhich of the following is a measure of Debt Service capacity of a firm?

38. Collection of net income, amortization and depreciation is divided by common shares outstanding to calculate

cash flow of financing activities

cash flow per share

cash flow of investment

cash flow of operations

Detailed SolutionCollection of net income, amortization and depreciation is divided by common shares outstanding to calculate

39. FL is zero if:

EBIT = Interest

EBIT = Zero

EBIT = Fixed Cost

EBIT = Pref. Dividend

Detailed SolutionFL is zero if:

40. Ratio of Net Income to Number of Equity Shares known as:

Price Earnings Ratio

Net Profit Ratio

Earnings per Share

Dividend per Share

Detailed SolutionRatio of Net Income to Number of Equity Shares known as:

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