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OCM MCQ

FINANCIAL MANAGEMENT · Gujarat Board (GSEB) STD 12 Commerce (GSEB - English Medium). 58 questions.

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MCQ 11 Mark
Which statement is true with reference to fixed capital?
  • A
    Invested up to $5$ years in business.
  • B
    Components are debtors, bill receivable, bank balance et
  • ✓
    Ratio of liquidity is less.
  • D
    Investment can be withdrawn easily.
Answer
Correct option: C.
Ratio of liquidity is less.
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MCQ 21 Mark
Form which capital is dividend paid?
  • ✓
    Paid up capital
  • B
    Authorized capital
  • C
    Called up capital
  • D
    Working capital
Answer
Correct option: A.
Paid up capital
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MCQ 41 Mark
Which of the following statement is not true with reference to the concept of net working capital?
  • ✓
    Excess of current assets over current liabilities.
  • B
    Doesn’t show the liquidity position of the company.
  • C
    Provide proper measurement for working capital.
  • D
    Increase in current liability doesn’t increase net working capital.
Answer
Correct option: A.
Excess of current assets over current liabilities.
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MCQ 51 Mark
Capital structure having proper ration of equity and debt means$……..$
  • ✓
    Optimum capital structure.
  • B
    Simple capital structure.
  • C
    Working capital structure.
  • D
    Equilibrium capital structure.
Answer
Correct option: A.
Optimum capital structure.
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MCQ 61 Mark
Decision of investment means$……..$
  • A
    Capital cost.
  • ✓
    Capital budgeting.
  • C
    Capital structure.
  • D
    Ploughing back of profit.
Answer
Correct option: B.
Capital budgeting.
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MCQ 71 Mark
With what is financial management related?
  • ✓
    Finance function
  • B
    Finance market
  • C
    Capital market
  • D
    Stock exchange
Answer
Correct option: A.
Finance function
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MCQ 81 Mark
On which concept the approach to wealth maximization is based?
  • A
    Profitability.
  • B
    Social responsibility.
  • ✓
    Present value of wealth.
  • D
    Cash flow.
Answer
Correct option: C.
Present value of wealth.
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MCQ 91 Mark
Excess current assets over current liabilities means$………$
  • ✓
    Positive working capital.
  • B
    Negative working capital.
  • C
    Equilibrium working capital.
  • D
    Gross working capital.
Answer
Correct option: A.
Positive working capital.
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MCQ 101 Mark
With whom has the foreign investment institution got registered?
  • A
    Company registers
  • B
    Court
  • C
    Stock exchange
  • ✓
    $SEBI.$
Answer
Correct option: D.
$SEBI.$
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MCQ 111 Mark
By which other name is the objective of wealth maximization known?
  • A
    Social welfare
  • B
    Capital investment
  • ✓
    Net present value
  • D
    Trading on equity
Answer
Correct option: C.
Net present value
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MCQ 121 Mark
Since the form of working capital keeps on changing, it’s $..........$ is not calculated.
  • A
    Interest
  • B
    Pay-out
  • ✓
    Depreciation
  • D
    Impact
Answer
Correct option: C.
Depreciation
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MCQ 131 Mark
Which of the following is not a part of gross working capital?
  • A
    Bills receivables
  • B
    Short term marketable securities
  • ✓
    Furniture and fixture
  • D
    None of these
Answer
Correct option: C.
Furniture and fixture
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MCQ 141 Mark
For a capital to be called fixed capital, it should be invested in the company for at least $..........$ years.
  • A
    $2$
  • ✓
    $5$
  • C
    $7$
  • D
    $10$
Answer
Correct option: B.
$5$
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MCQ 151 Mark
If the current rate of interest is high in capital market, companies prefer to raise capital by $..........$ rather than
  • ✓
    Issuing shares; Borrowing capital
  • B
    Taking bank loans; Issuing shares
  • C
    Borrowing capital; Bank loans
  • D
    Releasing bonds; Issuing shares
Answer
Correct option: A.
Issuing shares; Borrowing capital
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MCQ 161 Mark
How much money should be lent largely depends on
  • A
    Amount of borrowed capital
  • B
    Shareholding by the company
  • ✓
    Debentures
  • D
    Dividend
Answer
Correct option: C.
Debentures
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MCQ 171 Mark
Which avenue of investment should be preferred during recession in the market?
  • ✓
    Debenture
  • B
    Capital
  • C
    Lending
  • D
    None of these
Answer
Correct option: A.
Debenture
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MCQ 181 Mark
If the business requires fixed assets on large scale, then the ratio of $..........$ will be high in capital structure of that business.
  • A
    Debentures
  • B
    Borrowed capital
  • ✓
    Equity share
  • D
    Bank loan
Answer
Correct option: C.
Equity share
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MCQ 191 Mark
Investment decisions are related to $..........$
  • A
    Shares and debentures
  • B
    Outstanding dividend to issue
  • ✓
    Assets
  • D
    Borrowed capital
Answer
Correct option: C.
Assets
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MCQ 201 Mark
Which of the following is not an external factor affecting capital structure?
  • A
    Condition of boom-depression in capital market
  • B
    Cost of capital expenses of issuing securities
  • C
    Legal restrictions
  • ✓
    None of these
Answer
Correct option: D.
None of these
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MCQ 211 Mark
Who are the real owners of the company?
  • A
    Managing directors
  • B
    Chief Executive Officer
  • ✓
    Shareholders
  • D
    All stake holders
Answer
Correct option: C.
Shareholders
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MCQ 221 Mark
Which of the following is not an internal factor affecting capital structure?
  • A
    Type of business
  • B
    Nature and requirement of assets
  • ✓
    Institutional investors
  • D
    Financial requirements
Answer
Correct option: C.
Institutional investors
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MCQ 231 Mark
Planning of fixed capital management is not required for
  • A
    Land
  • B
    Building
  • ✓
    Raw material
  • D
    Technology upgradation
Answer
Correct option: C.
Raw material
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MCQ 241 Mark
“Capital structure means the proportion and magnitude of different securities issued and sources utilized by a company to raise its finance.” Who gave this definition?
  • A
    F. W. Paish
  • B
    Gary Hamel
  • C
    Prof. M. Kimbal
  • ✓
    Hogland
Answer
Correct option: D.
Hogland
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MCQ 251 Mark
$..........$ provides base for managerial decisions.
  • ✓
    Finance management
  • B
    Production management
  • C
    Quality control management
  • D
    Sales and marketing management
Answer
Correct option: A.
Finance management
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MCQ 261 Mark
Dividend is a part of of a company which is distributed among its shareholders.
  • ✓
    Profit
  • B
    Investment
  • C
    Capital
  • D
    Share
Answer
Correct option: A.
Profit
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MCQ 271 Mark
Financial management has to make important decision related to
  • A
    Decisions related to investment
  • B
    Decisions related to financing
  • C
    Decisions related to dividend
  • ✓
    All of these
Answer
Correct option: D.
All of these
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MCQ 281 Mark
Prof. Solomon has favoured
  • ✓
    Wealth maximization
  • B
    Profit maximization
  • C
    Both $(A)$ and $(B)$
  • D
    None of these
Answer
Correct option: A.
Wealth maximization
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MCQ 291 Mark
Which approach does the financial management adopt for maximizing economic welfare of the business owner?
  • A
    Profit maximization
  • B
    Wealth maximization
  • C
    Profit and market-share maximization
  • ✓
    Both $(A)$ and $(B)$
Answer
Correct option: D.
Both $(A)$ and $(B)$
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MCQ 301 Mark
Financial management includes which of the following management functions?
  • A
    Planning
  • B
    Controlling
  • C
    Directing
  • ✓
    Both $(A)$ and $(B)$
Answer
Correct option: D.
Both $(A)$ and $(B)$
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MCQ 311 Mark
“In the modern economy, based on utilization of funds, financial management means acquiring of required funds at the required time.” Who gave this definition?
  • A
    Prof. M. Kimbal
  • B
    Gary Hamel
  • ✓
    F. W. Paish
  • D
    Raymond J. Chambers
Answer
Correct option: C.
F. W. Paish
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MCQ 331 Mark
Which of the following expense is not included in capital cost for issuing securities?
  • A
    Underwriting commission.
  • B
    Brokerage.
  • C
    Prospectus expense.               
  • ✓
    All of the given.
Answer
Correct option: D.
All of the given.
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MCQ 341 Mark
Directors do not increase which of the following securities to keep managerial control?
  • ✓
    Equity share
  • B
    Preference share
  • C
    Debenture
  • D
    Bank loan.
Answer
Correct option: A.
Equity share
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MCQ 351 Mark
Directors do not increase which of the following securities to keep managerial control?
  • ✓
    Equity share
  • B
    Preference share
  • C
    Debenture
  • D
    Bank loan.
Answer
Correct option: A.
Equity share
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MCQ 361 Mark
What is the base of debenture in capital structure?
  • A
    Director’s policy.
  • ✓
    Steady income.
  • C
    Government policy.
  • D
    Requirement of capital.
Answer
Correct option: B.
Steady income.
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MCQ 371 Mark
From which view point ideal capital structure should be simple?
  • A
    From view point of securities.
  • B
    From view point of expenses.
  • ✓
    From view point of administration.
  • D
    From view point of taxation.
Answer
Correct option: C.
From view point of administration.
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MCQ 381 Mark
How long fixed capital remains invested in fixed assets?
  • A
    More than $3$ years
  • ✓
    More than $5$ years
  • C
    More than $10$ years
  • D
    More than $7$ years.
Answer
Correct option: B.
More than $5$ years
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MCQ 391 Mark
During boom in which of the following is the investors prefer to investment?
  • A
    Land
  • B
    Jewellary
  • ✓
    Equity share
  • D
    Debenture.
Answer
Correct option: C.
Equity share
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MCQ 401 Mark
To determine sources of capital investment means$………$
  • ✓
    Problem of capital structure.
  • B
    Problem of capitalization.
  • C
    Finance problem.
  • D
    Problem of management.
Answer
Correct option: A.
Problem of capital structure.
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MCQ 411 Mark
Decisions related to lending are related to which of the following?
  • A
    Finance
  • ✓
    Debentures
  • C
    Individual
  • D
    Interest.
Answer
Correct option: B.
Debentures
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MCQ 421 Mark
Decisions related to investment are related to which of the following?
  • A
    Shares
  • B
    Debentures
  • C
    Land
  • ✓
    Assets.
Answer
Correct option: D.
Assets.
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MCQ 431 Mark
On which payment of dividend depends?
  • A
    Gross-profit 
  • B
    Number of shares
  • ✓
    Available cash
  • D
    Reserve fun
Answer
Correct option: C.
Available cash
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MCQ 441 Mark
To which of the following financial management is related?
  • A
    Profit-loss.
  • ✓
    Finance function.
  • C
    Establishment of business.
  • D
    Financial accounting.
Answer
Correct option: B.
Finance function.
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MCQ 451 Mark
Which of the following decision is not taken by financial management?
  • A
    Dividend policy
  • B
    Capital budget
  • ✓
    Advertisement policy
  • D
    Ploughing back of profit.
Answer
Correct option: C.
Advertisement policy
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MCQ 461 Mark
Who are the owners of the company?
  • A
    Debenture holders
  • ✓
    Share holders
  • C
    Directors
  • D
    Managing director.
Answer
Correct option: B.
Share holders
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MCQ 471 Mark
For which expenses working capital management is required?
  • A
    Long term management.
  • B
    Contingency expense.
  • C
    Expansion expense.
  • ✓
    Day-to-day expense.
Answer
Correct option: D.
Day-to-day expense.
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MCQ 481 Mark
Which of the following is ignored in maximization of wealth?
  • A
    Cash profit
  • ✓
    Accounting profit
  • C
    Gross profit
  • D
    Dividen
Answer
Correct option: B.
Accounting profit
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MCQ 491 Mark
Standards of maximization of wealth depends on which of the following concept?
  • A
    Assets
  • B
    Net assets
  • ✓
    Cash liquidity
  • D
    Dividen
Answer
Correct option: C.
Cash liquidity
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MCQ 501 Mark
What can company increase through the objective of maximization of profit?
  • ✓
    Earnings per share
  • B
    Sale
  • C
    Production
  • D
    Branches.
Answer
Correct option: A.
Earnings per share
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