This quiz works best with JavaScript enabled. Home > Finance > Management > Financial Management > Financial Management – Quiz 42 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Financial Management Quiz 42 (30 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. Why are Capital Budgeting Decisions critical? A) Risk involved. B) Decisions are irreversible. C) Large Amounts of funds involved. D) All of the above. Show Answer Correct Answer: D) All of the above. 2. A secure box in a bank's vault used for the safe storage of a customer's valuables such as jewelry, birth certificates and other important documents. A) Risk box. B) Trust box. C) Safe-deposit box. D) Secret box. Show Answer Correct Answer: C) Safe-deposit box. 3. A common financial service used by many consumers. They can help to manage money and make paying bills more conveniently. A) Savings Account. B) PIN. C) Debit Card. D) Checking Account. Show Answer Correct Answer: D) Checking Account. 4. At the end of the period covered by a budget, the business will prepare new financial statements. A) False. B) True. Show Answer Correct Answer: B) True. 5. Evelyn, Marryssa, and Camden are discussing the concept of time value of money in financial management. Camden believes that the value of money remains constant over time. Evelyn thinks that money available at the present time is worth more than the same amount in the future due to its potential earning capacity. Marryssa, on the other hand, believes that the concept of time value of money is not applicable in financial management. According to the principles of financial management, who is correct? A) Camden:The value of money remains constant over time. B) Evelyn:Money available at the present time is worth more than the same amount in the future due to its potential earning capacity. C) Marryssa:The concept of time value of money is not applicable in financial management. D) None of them are correct. Show Answer Correct Answer: B) Evelyn:Money available at the present time is worth more than the same amount in the future due to its potential earning capacity. 6. The type of financing where the firm that specializes in buying other firm's account receivable refers to? A) Commercial paper. B) Promissory note. C) Mortgage. D) Factoring. Show Answer Correct Answer: D) Factoring. 7. Only revenue nature cash flow is shown in cash budget A) True. B) False. C) Other. D) None of above. Show Answer Correct Answer: B) False. 8. Analysis simply means ..... data. A) Complexing data. B) Simplification. C) Hiding data. D) None. Show Answer Correct Answer: B) Simplification. 9. What is the difference between current and non current assets? A) There is no difference. B) Current assets are the same as current liabilities and non current are not. C) Current assets tend to be easily converted to cash whereas non current are not. D) A company will gain more profit if they use non current only. Show Answer Correct Answer: C) Current assets tend to be easily converted to cash whereas non current are not. 10. Horizontal analysis is a technique for evaluating a series of financial statement data over a period of time A) To determine the amount and/or percentage increase or decrease that has taken place. B) That has been arranged from the highest number to the lowest number. C) That has been arranged from the lowest number to the highest number. D) To determine which items are in error. Show Answer Correct Answer: A) To determine the amount and/or percentage increase or decrease that has taken place. 11. Short term financial goals can be achieved in less than a year and does not involve in a large amount of money. A) True. B) False. Show Answer Correct Answer: A) True. 12. Which of the following is true about the 'inflation' figure that is included in the money cost of capital? A) It is historic and specific to the business. B) It is historic general inflation suffered by the investors. C) It is expected and specific to the business. D) It is expected general inflation suffered by the investors. Show Answer Correct Answer: D) It is expected general inflation suffered by the investors. 13. Present value of Rs. 1 received after 2 years with 10% discounting rate. A) 0.286. B) 0.268. C) 0.628. D) 0.826. Show Answer Correct Answer: D) 0.826. 14. Working Capital Management refers to Receivables Management A) True. B) False. C) May be. D) None. Show Answer Correct Answer: B) False. 15. The agency problem arises due to the separation of ownership and control in a corporation. A) False. B) True. Show Answer Correct Answer: B) True. 16. What Site Can you Get a Free Credit Report A) CreditReportAnnual.com. B) Annualcreditreport.com. C) CreditKarma.com. D) CreditReport.gov. E) Annualreport.com. Show Answer Correct Answer: B) Annualcreditreport.com. 17. Financing decisions involve A) Debt Equity decisions. B) Capital Budgeting decisions. C) Fixed assets decisions. D) Shareholders fund decisions. Show Answer Correct Answer: A) Debt Equity decisions. 18. Which type of bank is NON PROFIT and run by its members? A) Credit Unions. B) Commercial banks. Show Answer Correct Answer: A) Credit Unions. 19. Agency costs are costs incurred when: A) Managers do not attempt to maximize firm value. B) Shareholders incur costs to monitor the managers and influence their actions. C) Both of these options. D) None of these options. Show Answer Correct Answer: C) Both of these options. 20. There are checks in the checkbook, so there must be money in the checking account A) Fact. B) Fiction. Show Answer Correct Answer: B) Fiction. 21. All income that a business receives over a period of time is called profit. A) False. B) True. Show Answer Correct Answer: A) False. 22. The knowledge and skillset necessary to be an informed consumer and manage finances effectively A) Loan. B) Interest. C) Credit. D) Financial Literacy. Show Answer Correct Answer: D) Financial Literacy. 23. In the wider sense Capital structure mens- A) Owned Capital. B) Owned Capital + Long-term loan. C) Owned Capital + Short-term Loan. D) Owned Capital + Loan. Show Answer Correct Answer: D) Owned Capital + Loan. 24. Funding for international activities can come from three main sources, except A) Debt financing. B) Equity financing. C) Intra-company financing. D) Multiple funding. Show Answer Correct Answer: D) Multiple funding. 25. What does the "A" mean in SMART goals? A) Attraction. B) Active-Management. C) Attainable. D) Active. E) Attention. Show Answer Correct Answer: B) Active-Management. 26. Issuance of bonds to obtain cash A) Financing Activities. B) Operating Activities. C) Investing Activities. D) None of above. Show Answer Correct Answer: A) Financing Activities. 27. What is the purpose of your net worth? A) To flash off your money. B) To learn how rich your favorite celebrity is. C) To show how financially healthy you are. D) To learn about how money works. E) To learn how much in debt you are. Show Answer Correct Answer: C) To show how financially healthy you are. 28. How does a higher times interest earned ratio impact a company's risk of default on its debt obligations? A) Implies higher financial leverage. B) Increases the risk of default. C) Reduces the risk of default. D) Indicates lower profitability. Show Answer Correct Answer: C) Reduces the risk of default. 29. Free cash flow is the ..... A) Cash flow from assets. B) Remaining cash free to distribute to creditors and owners of the firm. C) Cash that a company generates to operate the company. D) All of the above. Show Answer Correct Answer: D) All of the above. 30. What a company owns A) Profits. B) Owner's equity. C) Revenue. D) Assets. Show Answer Correct Answer: D) Assets. ← 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