Financial Management MCQs and Notes
Q. Banks generally prefer Debt Equity Ratio at :
✅ Correct Answer: (C)
2:1
Q. Debt Equity Ratio is 3:1,the amount of total assets Rs.20 lac,current ratio is 1.5:1 and owned funds Rs.3 lac.What is the amount of current asset?
✅ Correct Answer: (C)
Rs.12 lac
Q. Which of the following are not among the daily activities of financial management?
✅ Correct Answer: (A)
sale of shares and bonds
Q. Which of the following is not the responsibility of financial management?
✅ Correct Answer: (C)
preparation of the firm's accounting statements
Q. Which of the following is not a metric to use for measuring the length of the cash cycle?
✅ Correct Answer: (A)
Acid test days.
Q. Which of the following working capital strategies is the most aggressive?
✅ Correct Answer: (C)
Making greater use of short term finance and minimizing net short term asset.
Q. What is the difference between the current ratio and the quick ratio?
✅ Correct Answer: (A)
The current ratio includes inventories and the quick ratio does not.
Q. Which of the following would not be financed from working capital?
✅ Correct Answer: (D)
A new personal computer for the office.
Q. If the weighting of equity in total capital is 1/3, that of debt is 2/3, the return on equity is 15% that of debt is 10% and the corporate tax rate is 32%, what is the Weighted Average Cost of Capital (WACC)?
✅ Correct Answer: (C)
9.533%