Practice Test

Q1) Business finance deals with all _____ of business. Show Answer

Q2) Business finance refers to _____ Show Answer

Q3) _____ is nothing but budgeting financial needs of the expected programmes. Show Answer

Q4) A large proportion of initial funds is invested in _____ Show Answer

Q5) _____ provides advice to Board of Directors in respect of financial matters. Show Answer

Q6) _____ is a basic principle of any business activity. Show Answer

Q7) A business firm is basically _____ organisation Show Answer

Q8) Due to__ planning, it is possible to eliminate wasteful expenditure Show Answer

Q9) The _____ means mix up of various sources of funds in desired proportion Show Answer

Q10) Large manufacturing companies have ___ investment in fixed assets. Show Answer

Q11) Big retail stores require large amount of _____ capital Show Answer

Q12) The _____ concerns can acquire funds from various sources. Show Answer

Q13) The investors who are ready to take risk, prefer _____ shares for investment Show Answer

Q14) The _____ capital stays in business almost permanently. Show Answer

Q15) The difference between current assets and current liabilities is _____ capital Show Answer

Q16) A firm selling on credit terms require ______ working capital Show Answer

Q17) A firm making cash sales requires _____ working capital Show Answer

Q18) If volume of sales increases, there is _______ in amount of working capital Show Answer

Q19) Financial management is essential for all types of organizations. Show Answer

Q20) Financial planning helps in eliminating wasteful expenditure of the firm Show Answer

Q21) There is no hard and fast rule for the proportion of owned funds and borrowed funds Show Answer

Q22) It is not possible to go ahead without financial plan Show Answer

Q23) Requirement of working capital does not depend upon any factor Show Answer

Q24) ______ is related to money and money management. Show Answer

Q25) Finance is the management of _____ affairs of the company Show Answer

Q26) Corporation finance deals with acquisition and use of _____ by business corporation Show Answer

Q27) Company has to pay _____to government. Show Answer

Q28) ______ refers to any kind of fixed assets. Show Answer

Q29) ______ refers to the excess of current assets over current liabilities. Show Answer

Q30) Manufacturing industries have to invest _____ amount of funds to acquire fixed assets. Show Answer

Q31) When the population is increasing at high rate, certain manufacturers find this as an opportunity to ______ business. Show Answer

Q32) The sum of all _____ is gross
Working capital.
Show Answer

Q33) _____ means mix up of various sources of funds in desired proportion. Show Answer

Q34) Finding investments and deploying them successfully in the business is known as capital _______. Show Answer

Q35) It is difficult to perform any function of business enterprise independently without _____. Show Answer

Q36) Fixed capital is used for buying fixed assets which are used for _____ period of time Show Answer

Q37) Fixed capital stays in business almost _____. Show Answer

Q38) Trading business may not need huge investments in ______ assets Show Answer

Q39) Fixed capital requirements are likely to be ______ when business operation are done on a large scale. Show Answer

Q40) Working capital can also be called as ______ capital Show Answer

Q41) If the business is dealing in luxurious products, it requires _____ the amount of working capital. Show Answer

Q42) If volume of sales increases, there is an increase in the amount of _____ capital. Show Answer

Q43) If manufacturing cycle is short, it required less _____ capital. Show Answer

Q44) Ploughing back of profit is _____ source of financing. Show Answer

Q45) Corporate finance brings co-ordination between various business activities. Show Answer

Q46) During recession, sales will decline and hence the need of _____ capital also decline. Show Answer

Q47) The working capital requirement of a firm will _____ with a growth of a firm. Show Answer

Q48) A combination of different sources of capital used in capital structure is _____ mix. Show Answer

Q49) _____ shares bears an ultimate risk. Show Answer

Q50) Business firm gives green signal to the project only when it is profitable. Show Answer

Q51) Fixed capital is also referred as circulating capital. Show Answer

Q52) The business will require huge fund, if assets are acquired on lease basis. Show Answer

Q53) The business dealing in luxurious products will require huge amount of working capital. Show Answer

Q54) A firm with large scale operations, will require more working capital. Show Answer

Q55) Liberal credit policy creates a problem of bad debts. Show Answer

Q56) Corporate finance plays significant role in decision making process. Show Answer

Q57) Finance becomes optional for expansion and diversification of a company. Show Answer

Q58) Company needs financial aid to manage several risks like fall in sales, loss due to natural calamity, etc. Show Answer

Q59) Fixed capital is used for a shorter period of time. Show Answer

Q60) Fixed capital is required usually at the time of establishment of a new company. Show Answer

Q61) Trading business may need huge investments in fixed assets. Show Answer

Q62) Fixed capital requirements are likely to be high in large scale operations. Show Answer

Q63) Industries providing goods and services which are in good demand will require large amount of working capital. Show Answer

Q64) Trading firms which are concerned with distribution of goods need large amount of working capital. Show Answer

Q65) A firm with small scale operations require more working capital. Show Answer

Q66) The working capital requirement of a firm will decrease with growth of a firm. Show Answer

Q67) A combination of different sources of capital are used in capital structure. Show Answer

Q68) Retained earnings are internal source of finance. Show Answer

Q69) Shares are acknowledgement of loan raised by compnay. Show Answer

Q70) A company cannot exist without _______ shares. Show Answer

Q71) The _______ shares bear ultimate risk associated with membership. Show Answer

Q72) Company has to pay interest regularly to _______. Show Answer

Q73) Debentures are secured through _______. Show Answer

Q74) A shareholder is entitle to receive _______ as return for investment. Show Answer

Q75) Success of any business organisation depends on the efficiency of the generation and use of __________. Show Answer

Q76) The firm has to use funds in such a manner that the returns are more than __________. Show Answer

Q77) Investment decisions are also known as __________. Show Answer

Q78) The __________ capital remains in business almost permanently. Show Answer

Q79) __________ business may not need huge investments in fixed assets, Show Answer

Q80) Gerstenbergh prefers to call working capital as __________. Show Answer

Q81) Firms producing __________ products will require relatively less working capital. Show Answer

Q82) Trading firms need large amount of __________. Show Answer

Q83) The __________ and size of working capital are directly related to each other Show Answer

Q84) The process of converting raw materials into finished goods is called __________. Show Answer

Q85) __________ is a factor of credit control. Show Answer

Q86) Liberal credit policy can increase the possibility of __________. Show Answer

Q87) A firm keeping __________ will require higher levels of working capital. Show Answer

Q88) Owned funds include __________. Show Answer

Q89) __________ bears the ultimate risk associated with ownership. Show Answer

Q90) __________ is ploughing back of profits. Show Answer

Q91) __________ carry dividend at a fixed rate. Show Answer

Q92) __________ carry a fixed rate of interest. Show Answer

Q93) Finance is related to money and money management. Show Answer

Q94) Working capital stays in the business almost permanently. Show Answer

Q95) Financial institutions and banks cater to the working capital requirement of business. Show Answer

Q96) Corporate finance deals only with acquisition of finance by a company. Show Answer

Q97) A firm has multiple choices for sources of financing. Show Answer

Q98) Financing decision is also known as capital budgeting. Show Answer

Q99) Commercial viability of the business is investigated once the business is set up. Show Answer

Q100) Inventories are an example of fixed assets. Show Answer

Q101) Initial planning of fixed capital requirement is made by company's promoters. Show Answer

Q102) A business carrying operations on large scale will require less amount of fixed capital. Show Answer

Q103) Capital for financing receivables comes under working capital. Show Answer

Q104) If the volume of sales increases, there is decrease in working capital requirements. Show Answer

Q105) If the production cycle is longer, then the firm needs lesser amount of working capital. Show Answer

Q106) When there is a boom in the economy, more working capital is required. Show Answer

Q107) The firm making credit sales requires less working capital. Show Answer

Q108) A company's capital can consist of owned and borrowed capital. Show Answer

Q109) Owned funds include debentures. Show Answer

Q110) Equity shares are paid dividend before preference shares. Show Answer

Q111) Preference shares carry dividend at a fixed rate. Show Answer

Q112) Retained earnings are capital invested by shareholders. Show Answer

Q113) Term loans carry a fixed rate of interest. Show Answer