This quiz works best with JavaScript enabled. Home > Finance > Management > Financial Management > Financial Management – Quiz 25 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Financial Management Quiz 25 (30 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. Integrity is an ethical requirement for all financial managers. One aspect of integrity requires A) Avoiding of conflict of interest. B) Performance of professional duties in accordance with applicable laws. C) Maintenance of an appropriate level of professional competence. D) Refraining from improer use of inside information. Show Answer Correct Answer: A) Avoiding of conflict of interest. 2. Which of the following statements about the corporate form of business organization is true? A) The corporate form has the disadvantage of double taxation relative to a sole proprietorship. B) The corporate form is preferred over the sole proprietorship because a corporation is easier to form and faces less regulation. C) Sole proprietorships are the most common form of business organization because liability is limited to the amount invested in the business by the sole proprietor. D) The corporate form has the advantage of unlimited liability. Show Answer Correct Answer: A) The corporate form has the disadvantage of double taxation relative to a sole proprietorship. 3. What are the types of credit? A) Cash Credit, Sales Credit, Secured Credit, Revolving Credit, Single payment Credit, Installment Credit, I.O.U. B) Cash Credit, Savings account, Secured Credit, Revolving Credit, Single payment Credit, Installment Credit, I.O.U. C) Cash Credit, Checking Account, Secured Credit, Revolving Credit, Single payment Credit, Installment Credit, I.O.U. D) Cash Credit, Your parents, Secured Credit, Revolving Credit, Single payment Credit, Installment Credit, I.O.U. Show Answer Correct Answer: A) Cash Credit, Sales Credit, Secured Credit, Revolving Credit, Single payment Credit, Installment Credit, I.O.U. 4. If the Demand for money increases, what will happen to the Interest Rate? A) Decrease. B) Increase. C) No Change. D) None of above. Show Answer Correct Answer: B) Increase. 5. Cost of capital is the maximum rate of return expected by the investors A) True. B) False. Show Answer Correct Answer: B) False. 6. Steve works the same amount of hours each month. Steve worked 100 hours in the last pay period. He earns $ 22 per hour. What is Steve's gross pay? A) $ 1200. B) $ 2100. C) $ 2200. D) $ 1250. Show Answer Correct Answer: C) $ 2200. 7. What type of training do most business owners need to participate in? A) Financial forecasting training. B) Financial literacy training. C) Investment training. D) Personnel management training. Show Answer Correct Answer: B) Financial literacy training. 8. Exchange rates in the foreign exchange market represent the value of a currency relative to another currency. A) TRUE. B) FALSE. Show Answer Correct Answer: A) TRUE. 9. Two projects intersect, in terms of NPV, at a discount rate labeled the ..... A) Internal rate of return. B) Crossover rate. C) Discount rate. D) Yield to maturity. Show Answer Correct Answer: B) Crossover rate. 10. The formula of EBIT = ..... A) Sales-Variable cost. B) Contribution-Fixed cost. C) Sales-Fixed cost. D) All the above. Show Answer Correct Answer: B) Contribution-Fixed cost. 11. Which of the following identities is FALSE? A) Cash Flow to Owners = Dividends-Net New Borrowing from Owners. B) Net New Borrowing from Owners = Change in Equity. C) Change in Equity = Paid-in-Surplus-Net New Borrowing from Creditors. D) Net New Borrowing = Ending Long-term Liabilities-Beginning Long-Term Liabilities. Show Answer Correct Answer: C) Change in Equity = Paid-in-Surplus-Net New Borrowing from Creditors. 12. The primary goal of financial management is to: A) Maximize shareholder wealth. B) Minimize costs. C) Increase sales. D) Improve efficiency. E) All of the above. Show Answer Correct Answer: A) Maximize shareholder wealth. 13. What financial ratio measures a company's ability to meet its short-term obligations using its most liquid assets? A) Debt-to-Equity ratio. B) Price-Earnings (P/E) ratio. C) Return on Investment (ROI). D) Current ratio. Show Answer Correct Answer: D) Current ratio. 14. Market value of shares is influenced by A) Financial decision. B) Financing decision. C) Investment decision. D) Dividend decision. Show Answer Correct Answer: A) Financial decision. 15. The capital budget associated with A) Long term and short term assets. B) Long term assets. C) Short term assets. D) Fixed assets. Show Answer Correct Answer: B) Long term assets. 16. What is a common focus of financial management training? A) Marketing and sales. B) Money management and budgeting. C) Customer service and relationship building. D) Risk management and financial analysis. Show Answer Correct Answer: B) Money management and budgeting. 17. What are some basic objectives of financial management training? A) To increase profit margins. B) To reduce operational costs. C) To improve credit management skills. D) To develop financial planning skills. Show Answer Correct Answer: D) To develop financial planning skills. 18. The principle of investment is? A) Hoarding wealth so we can be arrogant. B) Postpone Consumption Today for Consumption Later. C) Make a profit in any way. D) None of above. Show Answer Correct Answer: B) Postpone Consumption Today for Consumption Later. 19. IF THE SALES OF A FIRM IS RS 10, 00, 000 AND CONTRIBUTION IS RS 2, 00, 000 THEN VARIABLE COSTS ARE A) RS 20, 00, 000. B) RS 8, 00, 000. C) RS 12, 00, 000. D) RS 5, 00, 000. Show Answer Correct Answer: B) RS 8, 00, 000. 20. Select the reasons for short term financing. A) Cash flow problems. B) Speculative productions. C) Increase inventory. D) All of the above. Show Answer Correct Answer: D) All of the above. 21. What does "liquidity" in financial terms indicate about a company? A) The efficiency of its production processes. B) Its ability to meet short-term obligations. C) The total value of its assets. D) The value of its long-term investments. Show Answer Correct Answer: B) Its ability to meet short-term obligations. 22. Which of the following colors coresponds with the correct ticker information? A) Blue is for higher. B) Orange is for lower. C) Green is for lower. D) Red is for higher. E) Yellow is for no change. Show Answer Correct Answer: E) Yellow is for no change. 23. It is the amount which is earned without investing time, money A) Amount. B) Leverage. C) Dividend. D) Return earnings. Show Answer Correct Answer: B) Leverage. 24. What is not an expense category that we are required to allocate from our income? A) Zakat and Taxes. B) Investments (children's education, retirement, Hajj, etc.). C) Walking/Travelling. D) None of above. Show Answer Correct Answer: C) Walking/Travelling. 25. Which financial ratio measures a company's ability to meet its short-term obligations? A) Gross profit margin. B) Debt-to-equity ratio. C) Current ratio. D) Return on equity (ROE). Show Answer Correct Answer: C) Current ratio. 26. If Lanten's gross pay is $ 1, 800 this pay period and the Medicare tax is 1.45%, how much Medicare tax will be deducted from Lanten's paycheck? A) $ 35.18. B) $ 26.10. C) $ 19.15. D) None of above. Show Answer Correct Answer: B) $ 26.10. 27. What is NOT a human habit A) Emotional. B) Smart purchasing. C) Addictive. D) Impulsive shopping. E) Easily spiral out of control. Show Answer Correct Answer: B) Smart purchasing. 28. A mortgage payment is an example of a A) Periodic Expense. B) Fixed Expense. C) Variable Expense. D) None of above. Show Answer Correct Answer: B) Fixed Expense. 29. The money invested in short term assets of a firm is called A) Fixed capital. B) Dividend. C) Working capital. D) Both a and c. Show Answer Correct Answer: C) Working capital. 30. The financial goal of a corporation is to maximize: A) Market value of the firm. B) Managers' benefits. C) Sales. D) Profits. Show Answer Correct Answer: A) Market value of the firm. ← 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