Tag: introduction to business capital/finance

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Questions Related to introduction to business capital/finance

Multiple choice commercial studies finance and accounts meaning and functions of finance and accounts department nature, need and significance of business finance introduction to business capital/finance

As per section 2(51) of the Companies Act, 2013, "Key Managerial Personnel", in relation to a company, means _______.
(i) Chief Executive officer or managing director or manager
(ii) Company Secretary
(iii) General Manager
(iv) Whole Time Director
(v) Chief Legal Officer 
(vi) Chief Financial Officer
The correct answer is -

  1. (i), (ii), (iv) & (vi)

  2. (i), (iii), (iv), (v) & (vi)

  3. (i), (ii), (v) & (vi)

  4. (i), (iv), (v) & (vi)
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

According to Section 2(51) of the Companies Act, 2013, Key Managerial Personnel includes the CEO/MD/Manager, Company Secretary, Whole-time Director, and CFO.

Multiple choice commercial studies finance and accounts meaning and functions of finance and accounts department nature, need and significance of business finance introduction to business capital/finance

Which of the following is the external user of financial statements?

  1. Manager of the business

  2. CEO of the business

  3. Creditor of the business

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

External users are those outside the organization who use financial statements to make decisions. Creditors use these statements to assess the creditworthiness of the business, unlike managers, CEOs, or controllers who are internal.

Multiple choice commercial studies finance and accounts meaning and functions of finance and accounts department nature, need and significance of business finance introduction to business capital/finance

Operating and financial leverage are _____________.

  1. Independent

  2. Dependent

  3. Interdependent

  4. None of these
Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation

Operating leverage and financial leverage are interdependent because they both affect the total risk and return of the firm. They interact to determine the overall financial structure and earnings per share volatility.

Multiple choice commercial studies finance and accounts meaning and functions of finance and accounts department nature, need and significance of business finance introduction to business capital/finance

Which of the following is said to be the lifeblood of an organization?

  1. Debentures

  2. Finance

  3. Material

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

Finance is regarded as the lifeblood of a business enterprise. It is the basic foundation of all kinds of economic activities. Finance is the master key that provides access to all the sources for being employed in manufacturing and merchandising activities. The success of an organization largely depends on efficient management of its finances.

Multiple choice commercial studies finance and accounts meaning and functions of finance and accounts department nature, need and significance of business finance introduction to business capital/finance

Money required for carrying out business activties is called ___________.

  1. financial management

  2. business finance

  3. finance

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

Business finance refers to money and credit employed in business. It involves procurement and utilization of funds so that business firms may be able to carry out their operations effectively and efficiently.

Multiple choice commercial studies finance and accounts meaning and functions of finance and accounts department nature, need and significance of business finance introduction to business capital/finance

Every business enterprise must undertake such business which is_________________.

  1. Unlawful

  2. Lawful

  3. Illegal

  4. All of above
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

Every business enterprise must undertake such business which is lawful. All business organization should adhere to the law of the country to ensure peace and order. Illegal and unlawful business organizations should not be undertaken.

Multiple choice commercial studies finance and accounts meaning and functions of finance and accounts department nature, need and significance of business finance introduction to business capital/finance

BIFR means.

  1. Board for Industrial and Financial Reconstruction

  2. Board for International and Financial Reconstruction

  3. Board for Industrial and Forex Reconstruction

  4. Board for International and Forex Revival
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

Board for Industrial and Financial Reconstruction $(BIFR)$ is a board setup by the Government of India, in order to tackle the problem of industrial sickness, under the purview of Sick Industrial Companies (Special Provisions) Act,$1985$ $(SICA)$.

Multiple choice commercial studies finance and accounts meaning and functions of finance and accounts department nature, need and significance of business finance introduction to business capital/finance

Interest paid by other than financial enterprises is shown in cash flow statement under ________________.

  1. Operating activities

  2. Investing activities

  3. Financing activities

  4. None of the above
Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation

Interest paid by non-financial enterprises is classified as a financing activity in the cash flow statement because it relates to the cost of obtaining financial resources. Operating activities typically involve the core revenue-generating activities of the business.

Multiple choice commercial studies finance and accounts meaning and functions of finance and accounts department nature, need and significance of business finance introduction to business capital/finance

To guard against the dangers of excess payment arising out of double insurance or over insurance made by the insured, insurance companies provide in their agreement _________________.

  1. Average clause

  2. Subrogation clause

  3. Risk clause

  4. Indemnity clause
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

The principle of indemnity ensures that an insured party is compensated only for the actual loss suffered, preventing them from profiting from an insurance claim. This prevents the dangers of over-insurance or double insurance.