Financial Management
451. Which of the following is not a benefit of carrying inventories
- Reduction in ordering cost
- Avoiding lost sales
- Reducing carrying cost
- Avoiding Production Shortages
Correct answer: (C)
Reducing carrying cost
452. Which of the following is a liability of a bank?
- Treasury Bills
- Commercial papers
- Certificate of Deposits
- Junk Bonds
Correct answer: (C)
Certificate of Deposits
453. Commercial paper are generally issued at a pries
- Equal to face value
- More than face value
- Less than face value
- Equal to redemption value
Correct answer: (C)
Less than face value
454. Under income-tax provisions, depreciation on lease asset is allowed to
- Lessor
- Lessee
- Any of the two
- None of the two
Correct answer: (A)
Lessor
455. From the point of view of the lessee, a lease is a:
- Working capital decision
- Financing decision
- Buy or make decision
- Investment decision
Correct answer: (B)
Financing decision
456. Risk-aversion of an investor can be measured by
- Market Rate of Return
- Risk-free Rate of Return
- Portfolio Return
- None of the above.
Correct answer: (D)
None of the above
457. Working Capital Turnover measures the relationship of Working Capital with:
- Fixed Assets
- Sales
- Purchases
- Stock
Correct answer: (A)
Fixed Assets
458. A Current Ratio of Less than One means:
- Current Liabilities < Current Assets
- Fixed Assets > Current Assets
- Current Assets < Current Liabilities
- Share Capital > Current Assets
Correct answer: (C)
Current Assets < Current Liabilities
459. Which of the following is a measure of Debt Service capacity of a firm?
- Current Ratio
- Acid Test Ratio
- Interest Coverage Ratio
- Debtors Turnover
Correct answer: (C)
Interest Coverage Ratio
460. In Inventory Turnover calculation, what is taken in the numerator?
- Sales
- Cost of Goods Sold
- Opening Stock
- Closing Stock
Correct answer: (B)
Cost of Goods Sold