Tag: organisation of commerce and management

Quizzes (188) Questions (1057)

Questions Related to organisation of commerce and management

Multiple choice functional area of management financial management nature and significance of management organisation of commerce and management business studies

Any firm that goes bankrupt gradually will face one or more of the following symptoms _______________.

  1. Persistent cash loses

  2. Failure of pay taxes

  3. Cost overruns

  4. All of the above

  5. Both (A) and (C) above
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

Persistent cash losses, failure to pay taxes, cost overruns, low capacity utilization, accumulation of finished goods, etc.are the symptoms of bankruptcy.

Multiple choice functional area of management financial management nature and significance of management organisation of commerce and management business studies

For a weak unit which of the following should hold good _____________.

  1. Accumulated losses greater or equal to $50\%$ of its peak net worth during immediately preceding our accounting years

  2. A current ratio of less than 1:1

  3. Suffering losses in the previous accounting year

  4. All of the above

  5. Both (A) and (C) above
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

A non-small scale industrial unit is defined as weak if the accumulated losses at the end of any accounting year, resulting in the erosion of fifty percent or more of its peak net worth during the immediately preceding four accounting years.

Multiple choice functional area of management financial management nature and significance of management organisation of commerce and management business studies

Which of the following is not a factor affecting financing decision?

  1. Cost

  2. Risk

  3. Investment

  4. Cash flow position of the business
Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation

Factors affecting financing decision:-

(i) Cost
(ii) Cash flow position
(iii) Level of fixed operating cost
(iv) Control considerations
(v) Risk

Multiple choice functional area of management financial management nature and significance of management organisation of commerce and management business studies

India has signed a loan agreement of how much amount with the World Bank for strengthening the public financial management in Rajasthan project?

  1. $\$ 25.0$ million

  2. $\$ 31.0$ million

  3. $\$ 21.7$ million

  4. $\$ 23.8$ million
Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation

India has signed a loan agreement with the World Bank (WB) for $21.7 million for strengthening the public financial management in Rajasthan project in New Delhi on May 29, 2018. The objective of the project is to contribute to improved budget execution, enhanced accountability and greater efficiency in revenue administration in Rajasthan. 

It involves strengthening of the Public Financial Management Framework; strengthening of expenditure and revenue systems; and project management and capacity building among others. The project size is approximately $31 million, of which $21.7 million will be financed by the World Bank, and remaining amount will be funded out of the state budget. The project duration is 5 years.

Multiple choice functional area of management financial management nature and significance of management organisation of commerce and management business studies

Financial Management is concerned with

  1. Investment decisions

  2. Financing decisions

  3. Dividend decisions

  4. All of above
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation
  1. Investment decisions includes investment in fixed assets (called as capital budgeting). Investment in current assets are also a part of investment decisions called as working capital decisions.
  2. Financial decisions - They relate to the raising of finance from various resources which will depend upon decision on type of source, period of financing, cost of financing and the returns thereby.
  3. Dividend decision - The finance manager has to take decision with regards to the net profit distribution. Net profits are generally divided into two:
  • Dividend for shareholders- Dividend and the rate of it has to be decided.
  • Retained profits- Amount of retained profits has to be finalized which will depend upon expansion and diversification plans of the enterprise.
Multiple choice functional area of management financial management nature and significance of management organisation of commerce and management business studies

ABC Ltd. has declared $40$% dividend. Which one of the following does it mean?

  1. The company has declared $40$% on net profit as dividend

  2. The company has declared $40$% of profit after tax as dividend

  3. The company will provide dividend $40$% on issued capital

  4. The company will provide dividend $40$% on paid-up capital
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation
  • Dividend is that portion of profit which is distributed to shareholders.
  • Paid-up capital means the total amount of called up share capital which is actually paid to the company by the members. Dividend is declared on the paid-up form of capital.
  • Thus the company will provide dividend of 40% on paid-up capital.
Multiple choice functional area of management financial management nature and significance of management organisation of commerce and management business studies

Financial leverage is also referred to as _____________.

  1. Gearing

  2. Trading on equity

  3. Fixed changes leverage

  4. All the above
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

Financial leverage measures the extent to which a firm uses debt to finance its assets. It is synonymous with gearing and trading on equity, as all these terms describe the impact of fixed-cost financing on shareholder returns.

Multiple choice functional area of management financial management nature and significance of management organisation of commerce and management business studies

The note on dividend policy develops an investment approach which involves ______ steps

  1. 3

  2. 4

  3. 5

  4. 6
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

Standard financial literature on dividend policy frameworks typically outlines a 4-step approach involving analysis of earnings, determination of payout ratio, consideration of legal/tax constraints, and final board approval.

Multiple choice functional area of management financial management nature and significance of management organisation of commerce and management business studies

The dividend policy of a company is evolved within the framework of ___________.

  1. corporate law

  2. taxation

  3. managerial considerations

  4. All the above
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

Dividend policy is influenced by a complex interplay of corporate law (legal limits), taxation (tax implications for shareholders), and managerial considerations (growth needs and cash flow).