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Accounting, Banking and Finance MCQs
Business Finance
Quiz # 2, MCQs
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1)
Which of the following ratios are particularly interesting to short-term creditors?
- A) Liquidity Ratios
- B) Long-term Solvency Ratios
- C) Profitability Ratios
- D) Market Value Ratios
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2)
Quick Ratio is also known as:
- A) Current Ratio
- B) Acid-test Ratio
- C) Cash Ratio
- D) Solvency Ratio
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3)
A portion of profits, which a company retains itself for further expansion, is known as:
- A) Dividends
- B) Retained Earnings
- C) Capital Gain
- D) None of the given options
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4)
Which of the following is measured by profit margin?
- A) Operating efficiency
- B) Asset use efficiency
- C) Financial policy
- D) Dividend policy
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5)
Which of the following set of ratios is used to assess a business's ability to generate earnings as compared to its expenses and other relevant costs incurred during a specific period of time?
- A) Liquidity Ratios
- B) Leverage Ratios
- C) Profitability Ratios
- D) Market Value Ratios
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6)
A company having a current ratio of 1 will have __________ net working capital.
- A) Positive
- B) Negative
- C) zero
- D) None of the given options
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7)
Which of the following equation is known as Cash Flow (CF) identity?
- A) CF from Assets = CF to Creditors – CF to Stockholder
- B) CF from Assets = CF to Stockholders – CF to Creditors
- C) CF to Stockholders = CF to Creditors + CF from Assets
- D) CF from Assets = CF to Creditors + CF to Stockholder
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8)
The difference between current assets and current liabilities is known as:
- A) Surplus Asset
- B) Short-term Ratio
- C) Working Capital
- D) Current Ratio
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9)
The principal amount of a bond at issue is called:
- A) Par value
- B) Coupon value
- C) Present value of an annuity
- D) Present value of a lump sum
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10)
Which of the following is the process of planning and managing a firm‟s long-term investments?
- A) Capital Structuring
- B) Capital Rationing
- C) Capital Budgeting
- D) Working Capital Management
