This quiz works best with JavaScript enabled. Home > Finance > Management > Financial Management > Financial Management – Quiz 22 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Financial Management Quiz 22 (30 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. The primary goal of a publicly owned corporation is to ..... A) Maximize shareholder wealth. B) Minimize shareholder risk. C) Maximize earnings per share after taxes. D) Maximize dividends per share. Show Answer Correct Answer: A) Maximize shareholder wealth. 2. Which THREE of the following are the main types of decision facing the financial manager in a company? A. Income decision B. Investment decision C. Dividend decision D. Financing decision E. Appraisal decision F. Budget decision A) C, D, F. B) A, B & D. C) B, C & D. D) B, D & F. Show Answer Correct Answer: C) B, C & D. 3. Positive Leverage effect brings A) Gain for equity shareholders. B) Loss for equity shareholders. C) None. D) None of above. Show Answer Correct Answer: A) Gain for equity shareholders. 4. Income not spent on current consumption A) Savings. B) Investment. Show Answer Correct Answer: A) Savings. 5. What is the cost of raising funds called? A) Marginal Cost. B) Fixed Cost. C) Flotation Cost. D) Variable Cost. Show Answer Correct Answer: C) Flotation Cost. 6. Jose earns $ 1, 000 a month. He spends 35% of his income on rent for his house. How much money is Jose spending on rent? A) $ 35. B) $ 300. C) $ 350. D) None of above. Show Answer Correct Answer: C) $ 350. 7. What is the formula in finding current ratio? A) $c.\ \frac{total\ liabilities}{total\ assets}$. B) $a.\ \frac{current\ asset}{current\ liabilities}$. C) $d.\ \frac{Gross\ \Pr ofit}{Net\ sales}$. D) $b.\ \frac{360}{investor\ turnover}$. Show Answer Correct Answer: B) $a.\ \frac{current\ asset}{current\ liabilities}$. 8. Which of the following is NOT true with regard to an amortization table? A) The interest payment for a period is equal to the periodic interest rate multiplied by the beginning-of-the-period principal balance. B) The remaining principal balance at the end of a payment period is equal to the beginning-of-the-period principal less the total payment. C) The total payment is calculated by using the present value of an annuity formula. D) All of the above are true. Show Answer Correct Answer: B) The remaining principal balance at the end of a payment period is equal to the beginning-of-the-period principal less the total payment. 9. Markets for short-term highly liquid debt securities. A) Futures market. B) Money markets. C) Capital markets. D) Spot markets. Show Answer Correct Answer: B) Money markets. 10. The NCDOR e-File for ..... and e-File for fee website has a list of approved tax preparation software for participating e-File providers. A) Fun. B) Free. C) Businesses. D) None of above. Show Answer Correct Answer: B) Free. 11. "Discount pricing" means the discount price is ..... than the original price? A) Higher. B) Lower. C) The Same. D) None of these. Show Answer Correct Answer: B) Lower. 12. ..... is also referred to as working capital position or short-term financial position. A) LIQUIDITY. B) PROFITABILITY. Show Answer Correct Answer: A) LIQUIDITY. 13. A project has the following projected cash inflows.Year 1-100, 000Year 2-125, 000Year 3-105, 000 Working capital is required to be in place at the start of each year equal to 10% of the cash inflow for that year.The cost of capital is 10%. What is the present value of the working capital? A) $ (2, 735). B) $ 33, 000. C) $ (30, 036). D) $ Nil. Show Answer Correct Answer: A) $ (2, 735). 14. If the if the company has ideal fund that means there is large amount of ..... ? A) Cost of capital. B) Working capital. C) Inventory. D) Cash. Show Answer Correct Answer: B) Working capital. 15. The symbol of unlevered beta A) $b_L$. B) $U_B$. C) $b_u$. D) B. Show Answer Correct Answer: C) $b_u$. 16. What happens when a business expands? A) Profits will increase. B) Employees will likely be fired. C) Marketing activities can be put on hold forever. D) New factories and equipment may be needed. Show Answer Correct Answer: D) New factories and equipment may be needed. 17. It means distributing and investing a company's financial resources in ways that will increase its efficiency, and maximize its profits A) Capital allocation. B) Capital. C) Allocation. D) Bonds. Show Answer Correct Answer: A) Capital allocation. 18. Types of expenditure in terms of funding source divided in ..... A) External financing and Internal financing. B) Own capital expenditure and foreign spending. C) Internal expenditure and intensive spending. D) Expenditure and Foreign spending. Show Answer Correct Answer: A) External financing and Internal financing. 19. The government finance which includs the principles and practices relating to the Procurement and management of funds for Central Government, and Local bodies is known as: A) Public finance. B) Business Finance. C) Private Finance. D) All of these. Show Answer Correct Answer: A) Public finance. 20. Projects are mutually exclusive if picking one project eliminates the ability to pick the other project. This mutually exclusive situation can arise for different reasons. Which of the statements below is NOT one of these reasons? A) One project will always have a negative NPV. B) There is a scarce resource that both projects would need. C) There is need for only one project, and both projects can fulfill that current need. D) By using funds for one project, there are not enough funds available for the other project. Show Answer Correct Answer: A) One project will always have a negative NPV. 21. Which is not a major Credit Card network company A) American express. B) Capital One. C) Discover. D) Visa. E) Master Card. Show Answer Correct Answer: B) Capital One. 22. Which of the statements below is FALSE? A) Project A has a higher y-axis intercept for its NPV profile than mutually exclusive Project B. As long as the profile of Project A is above the profile of Project B, Project A will have a higher NPV value for that particular discount rate. B) Project A has a higher y-axis intercept for its NPV profile than mutually exclusive Project B. This means that Project A has a lower NPV than Project B when the discount rate is zero. C) Project A has a higher y-axis intercept for its NPV profile than mutually exclusive Project B. As we proceed past the crossover rate to the right on the x-axis, Project B's profile will be above Project A's profile. D) Project A and Project B are mutually exclusive. The two projects intersect in terms of NPV at a discount rate labeled the crossover rate. Show Answer Correct Answer: B) Project A has a higher y-axis intercept for its NPV profile than mutually exclusive Project B. This means that Project A has a lower NPV than Project B when the discount rate is zero. 23. Nick, Amaya, and Mason are running a small business together. Why is budgeting important in their financial management? A) Budgeting only helps in controlling the financial resources of their business. B) Budgeting is not important in their financial management. C) Budgeting is only important for their personal finance management. D) Budgeting is important in their financial management because it helps in planning and controlling the financial resources of their business. Show Answer Correct Answer: D) Budgeting is important in their financial management because it helps in planning and controlling the financial resources of their business. 24. What happens when a company is 'profitable' but the collection takes longer than payment to suppliers? A) OK-because it's still profitable. B) The company is in trouble and could go bankrupt. C) Companies need to focus on EBIT. D) The Cash Flow statement will show a negative number. Show Answer Correct Answer: D) The Cash Flow statement will show a negative number. 25. You are allowed to invest in shares of listed companies on the Johannesburg Stock Exchange (JSE). A) True. B) False. Show Answer Correct Answer: A) True. 26. Which ratio measures the efficiency of a company's inventory management? A) Debt Ratio. B) Inventory Turnover Ratio. C) Current Ratio. D) Profit Margin Ratio. Show Answer Correct Answer: B) Inventory Turnover Ratio. 27. Something that you pay is called ..... A) Savings. B) An expense. C) Income. D) A profit. Show Answer Correct Answer: B) An expense. 28. It pertains to the ability of the firm to yield a sufficient amount of return on company sales asset and invested capital. A) PROFITABILITY. B) LIQUIDITY. Show Answer Correct Answer: A) PROFITABILITY. 29. What are the 2 types of credit cards? A) Private Label and General Label. B) Private Label and Public Label. C) Public Label and General Label. D) Plastic and Metal. Show Answer Correct Answer: A) Private Label and General Label. 30. The definition of Pph 22 is a form of withholding or collection of tax carried out by one party against the Taxpayer on income in connection with the following, EXCEPT: A) The sale of goods is very luxurious. B) Purchase goods using APBN/APBD and non-APBN/APBD funds. C) Specialized labor transfer between countries. D) Import of goods/services. Show Answer Correct Answer: C) Specialized labor transfer between countries. ← PreviousNext →Related QuizzesManagement QuizzesFinance QuizzesFinancial Management Quiz 1Financial Management Quiz 2Financial Management Quiz 3Financial Management Quiz 4Financial Management Quiz 5Financial Management Quiz 6Financial Management Quiz 7Financial Management Quiz 8 🏠 Back to Homepage 📘 Download PDF Books 📕 Premium PDF Books