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WorksheetsFINANCIAL MANAGEMENT
Total questions: 20
Worksheet time: 15mins
Name
Class
Date
1.
Finance functions are
a)
Planning for funds
b)
Raising of funds
c)
Allocation of Resources
d)
All of the above
2.
Which financial decision help a businessman in opening a new branch of its business.
a)
Financing decision
b)
Dividend decision
c)
Investment decision
d)
None of the above
3.
Which component of capital structure determines the overall financial risk?
a)
Equity
b)
Debt
c)
Both Equity and Debt
d)
Retained Earnings
4.
The cheapest source of finance is
a)
Equity Shares
b)
Preference Shares
c)
Retained Earnings
d)
Debentures
5.
A decision to acquire a new and modern plant to upgrade an old one is
a)
Investments decision
b)
Financing decision
c)
Dividend Decision
d)
Working Capital decision
6.
Companies with higher growth potential are likely to
a)
Pay lower dividend
b)
Pay higher dividend
c)
Dividend are not affected by growth consideration
d)
None of the above
7.
Financial leverage is called favourable if
a)
ROI is lower than cost of debt
b)
ROI is higher than cost of debt
c)
Debt is nearly available
d)
If the degree of financial leverage is low
8.
Other things remaining the same, an increase in the tax rate on corporate profit will
a)
Make debt relatively cheaper
b)
Make debt relatively costlier
c)
No impact on cost of debt
d)
We can't say
9.
Net Woking capital refers to
a)
Total current Assets
b)
Current Asset + Current Liabilities
c)
Current Assets - Current Liabilities
d)
Current Liabilities - Current Assets
10.
Current Assets of business firm should be financed through :
a)
Current liability only
b)
Fixed Liability only
c)
Partly from both; current liability and fixed Liability
d)
None of the above
11.
A fixed assets of business firm should be financed through :
a)
Long term liability
b)
Short term Liability
c)
A Mix of long term and short term liability
d)
None of the above
12.
Current Assets are those assets which can be converted into cash within
a)
One month
b)
3 months
c)
12 months
d)
9 months
13.
Earning Per Share equals to :
a)
Earning after tax / no. of debentures
b)
Earning after tax / no. of Preference shares
c)
Earning after tax / no. of Equity shares
d)
None of the above
14.
EBIT refers to
a)
Equity before interest and tax
b)
Earning before investment and taxation
c)
Earning before interest and tax
d)
None of the above
15.
Return on Investment equals to :
a)
EBIT / Total equity
b)
EBIT / Interest on debt
c)
EBIT / Capital Employed
d)
EBIT / Total debt
16.
Which of the following assets is not considered as current asset:
a)
Stock
b)
Furniture
c)
Cash
d)
Goodwill
17.
The objective of wealth maximization takes into account
a)
Amount of returns expected
b)
Timing of anticipated returns
c)
Risk associated with uncertainty of returns
d)
All of the above
18.
Finance Function comprises
a)
Safe custody of funds only
b)
Expenditure of funds only
c)
Procurement of finance only
d)
Procurement & effective use of funds
19.
Financial management mainly focuses on
a)
Efficient management of every business
b)
Brand dimension
c)
Arrangement of funds
d)
All elements of acquiring and using means of financial resources for financial activities
20.
The concept which increases the return on equity shares with a change in the capital structure of a company.
a)
Trading on debt
b)
Trading on equity
c)
Trading on investment
d)
None of the above
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