sources of business finance Quiz -4

Out of the following which one is a type of intercorporate deposit.

• Three month deposit

• Call deposit

• Six month deposit

• All of these

Which of the preferential right is enjoyed by preference shareholders over equity share holders?

• Right to receive repayment of capital

• Right to receive fixed rate of dividend

• Voting rights

• Right to receive more dividend

Which of which of the following is source of borrowed fund.

• Equity shares

• Global depository receipt

• Inter corporate deposits

• Indian depository receipt

Out of the following, which one is not a feature of owners fund.

• Risk bearer capital

• Periodic interest payment

• Permanent capital

• New security needed

preference shares are referred as hybrid security because they have features of both................ & ................

• Equity shares, debentures

• Retained earnings, debentures

• Equity shares, public deposit

• Retained earnings, equity shares

retained earnings does not involve any cost in the form of

• Dividend

• Interest

• Floatation cost

• All of these

Public deposits are the deposits that are raised directly from:

• The public

• The Directors

• The auditors

• The owners

Assertion: the importance of business finances increased tremendously these days.

Reason: goods are produced on large scale and capital intensive techniques are used.

• Both assertion (A)and reason(R) are true and reason(R) is the correct explanation of assertion.

• Both Assertion (A) and Reason (R) is not the correct explanation of assertion (A)

• Assertion (A) is true but reason (R) is false

• Assertion (A) is false but reason (R) is true

Assertion: Equity share capital act as a permanent source of capital for the business

Reason: equity capital is to be repaid at the time of liquidation of a company

• Both assertion (A) and reason(R) are true and reason(R) is the correct explanation of assertion.

• Both Assertion (A) and Reason (R) is not the correct explanation of assertion (A)

• Assertion (A) is true but reason (R) is false

• Assertion (A) is false but reason (R) is true

Assertion: Borrowed fund holders have a legal right to get fixed return on their investment.

Reason: They have the complete control over companies affairs.

• Both assertion (A) and reason(R) are true and reason(R) is the correct explanation of assertion.

• Both Assertion (A) and Reason (R) is not the correct explanation of assertion (A)

• Assertion (A) is true but reason (R) is false

• Assertion (A) is false but reason (R) is true