Financial Management

441. Dividend declared by a company must be paid in

  1. 20 days
  2. 30 days
  3. 32 days
  4. 42 days
Correct answer: (B)
30 days

442. In India, Dividend Distribution tax is paid on

  1. Equity Share
  2. Preference Share
  3. Debenture
  4. Both (a) and (b)
Correct answer: (D)
Both (a) and (b)

443. Which of the following is not considered in Lintner's Model ?

  1. Dividend payout ratio
  2. Current EPS
  3. Speed of Adjustment
  4. Preceding year EPS
Correct answer: (D)
Preceding year EPS

444. The Transaction Motive for holding cash is for

  1. Safety Cushion
  2. Daily Operations
  3. Purchase of Assets
  4. Payment of Dividends
Correct answer: (B)
Daily Operations

445. Which of the following is not considered by Miller-Orr Model?

  1. Variability in cash requirement
  2. Cost of transaction
  3. Holding cost
  4. Total annual requirement of cash
Correct answer: (D)
Total annual requirement of cash

446. Which of the following is not a technique of receivables Management?

  1. Funds Flow Analysis
  2. Ageing Schedule
  3. Days sales outstanding
  4. Collection Matrix
Correct answer: (A)
Funds Flow Analysis

447. Securitization is related to conversion of

  1. Receivables
  2. Stock
  3. Investments
  4. Creditors
Correct answer: (A)
Receivables

448. Cash Discount term 3/15, net 40 means

  1. 3% Discount if payment in 15 days, otherwise full payment in 40 days
  2. 15% Discount if payment in 3 days, otherwise full payment 40 days
  3. 3% Interest if payment made in 40 days and 15%,interest thereafter
  4. None of the above
Correct answer: (A)
3% Discount if payment in 15 days, otherwise full payment in 40 days

449. Use of safety stock by a firm would

  1. Increase Inventory Cost
  2. Decrease Inventory Cost
  3. No effect on cost
  4. None of the above
Correct answer: (A)
Increase Inventory Cost

450. ABC Analysis is useful for analyzing the inventories:

  1. Based on their Quality
  2. Based on their Usage and value
  3. Based on Physical Volume
  4. All of the above
Correct answer: (B)
Based on their Usage and value
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