Multiple Choice Multiple Answer Question Due to diversification employees seek:Correct Answer Higher compensation , Job security , Better

opportunities within the firm Your Answer Higher compensation , Job security , Better opportunities within the firm Select The Blank Question A geographical segment cannot be ________. Correct Answer Countries in different zones Your Answer A single country Select The Blank Question A shareholder expects a higher rate of return as a firm's compensation for ________. Correct Answer Increased risk Your Answer Increased risk Multiple Choice Single Answer Question Most companies focus only on :Correct Answer Return on investment Your Answer Return on investment Multiple Choice Multiple Answer Question As a general rule, an asset is :Correct Answer A good or a right that a firm owns in a determined moment , Prepayment adjustments , Capitalized expenses Your Answer A good or a right that a firm owns in a determined moment , Prepayment adjustments , Capitalized expenses Multiple Choice Multiple Answer Question In the disclosures in financial statements, there are significant restrictions on :Correct Answer

The right of ownership , Realisability of investments , The remittance of income & proceeds of disposal Your Answer The right of ownership , The remittance of income & proceeds of disposal , Other disclosures Multiple Choice Single Answer Question Equity includes :Correct Answer Development Rebate Reserve Your Answer Deferred Payment Liabilities Match The Following Question Correct Answer Your Answer Free cash flow theory Enormous conflicts of interest between Stakeholders and shareholders Enormous conflicts of interest between Stakeholders and shareholders Net income approach Cost of debt & equity do not change with a change in leverage ratio Cost of debt & equity do not change with a change in leverage ratio Net operating income approach The overall capitalization rate remains constant for all levels of financial leverages The overall capitalization rate remains constant for all levels of financial leverages Modigliani - Miller Theory weighted average cost of capital does not change with a change in the proportion of debt to equity in the capital structure weighted average cost of capital does not change with a change in the proportion of debt to equity in the capital structure True/False Question Organisational changes are similar to mission changes. Correct Answer True Your Answer True Multiple Choice Single Answer Question Which of the following is NOT A Characteristic of declining firm :Correct Answer The optimum payout ratio for a declining firm is not 100 % Your Answer

The firm should not reinvest any profits Select The Blank Question A company shall buyback its shares through the stock exchange by making a public announcement at least ________ days prior to the commencement of buyback. Correct Answer Seven Your Answer Fourteen True/False Question Money becomes less valuable when received at a latter stage instead of in present time. Correct Answer True Your Answer True Select The Blank Question The resource theory considers that the competitive position of a firm depends on its ________ Assets. Correct Answer Specific Your Answer Intangible Multiple Choice Multiple Answer Question A firm having aggressive policy of investing in current assets will show the following features :Correct Answer Frequent production stoppages , High ROI Your Answer Frequent production stoppages , High ROI , Timely deliveries to customer True/False Question Making decision on dividend is a very crucial area of financial management for a firm. Correct Answer True Your Answer True Multiple Choice Single Answer Question

Segment reporting comes under :Correct Answer AS 17 Your Answer AS 17 True/False Question Usually cost data is perfect for ABC Analysis & distribution. Correct Answer False Your Answer False Multiple Choice Single Answer Question As per Pecking order theory, which is the costliest means of funding :Correct Answer Equity Shares Your Answer Equity Shares Match The Following Question Correct Answer Your Answer Mechanisms Performs or provides energy to an activity Performs or provides energy to an activity Inputs Information or material used to produce the output of an activity Information or material used to produce the output of an activity Controls Information or material that constrains an activity Information or material that constrains an activity Outputs Information or material produced by an activity Information or material produced by an activity True/False Question According to NOI Approach, any capital structure is optimum. Correct Answer True Your Answer True

Select The Blank Question The ________ often gives the best insight into the borrower's short term credit needs. Correct Answer Cash budget Your Answer Market research Select The Blank Question If firms have same technology ________ makes the difference i.e. firms become more productive . Correct Answer Solid human resource team Your Answer Latest & updated techniques True/False Question Explicit cost and implicit cost are the two parts of cost of debt. Correct Answer True Your Answer True Select The Blank Question If a segment is not designated as a ________ it should be included as an unallocated reconciling item. Correct Answer Reportable segment Your Answer Business segment Multiple Choice Single Answer Question Research into true human resources accounting began in :Correct Answer 1960`s Your Answer 1960`s Select The Blank Question Increase in cost of capital means decrease in ________.

Correct Answer Profitability Your Answer Expected returns True/False Question According to NI Approach, decrease in leverage decreases the overall cost of capital and increases the firm's value. Correct Answer False Your Answer True Multiple Choice Multiple Answer Question Accrued expenses represent :Correct Answer Costless financing , An interest free source of financing Your Answer Costless financing , An interest free source of financing Multiple Choice Multiple Answer Question The direct costs tier normally only includes the following :Correct Answer The personnel payroll , Supplies , Individual rental equipment Your Answer The personnel payroll , Supplies , Individual rental equipment Multiple Choice Single Answer Question Fixed price tender offers are accompanied by an abnormal announcement period return of :Correct Answer 8 - 10 % Your Answer 6-8% Multiple Choice Single Answer Question Many companies claim their main assets are their :Correct Answer People Your Answer Land

Multiple Choice Multiple Answer Question The main assumptions for stock repurchase models are as follows :Correct Answer The market is efficient , There is perfect competition in the securities market Your Answer The market is efficient , There is perfect competition in the securities market , Investors are not very keen to maximize the value of their investment Multiple Choice Single Answer Question The Buy back of shares shall not be made from Correct Answer The promoters or persons in control of the company Your Answer The promoters or persons in control of the company True/False Question Opportunity costs and real costs decrease the market value of a firm. Correct Answer True Your Answer False True/False Question Retained earnings are the most important internal sources of financing the growth of the firm. Correct Answer True Your Answer True True/False Question The chance of bankruptcy is small when the leverage of a firm is small. Correct Answer True Your Answer True Multiple Choice Multiple Answer Question Examples of accounting methods used by firm are :Correct Answer FIFO , LIFO , Accrual Accounting

Your Answer FIFO , LIFO , Overhead calculations Multiple Choice Single Answer Question For the following process the valuation is needed to decide the price at which the deal will be possibly concluded :Correct Answer Mergers & Acquisitions Your Answer Computation of wealth tax & gift tax True/False Question Diversification helps in preserving a firm's reputation & goodwill. Correct Answer True Your Answer True Multiple Choice Single Answer Question According to Net Income Approach, the average cost of capital declines as the leverage ratio :Correct Answer Increases Your Answer Increases True/False Question Whether a lease is a finance lease or an operating lease depends on the substance of the transaction rather than its form. Correct Answer False Your Answer True Select The Blank Question Forfeiting is mostly used for ________. Correct Answer Big ticket items & durable goods Your Answer Big ticket items & durable goods Multiple Choice Multiple Answer

Question The financial framework of a merger decision covers 3 interrelated aspects i.e. :Correct Answer Determining the firm's value , Financing techniques in mergers , Analysis of merger as a capital budgeting decision Your Answer Determining the firm's value , Financing techniques in mergers , Analysis of merger as a capital budgeting decision True/False Question For determining exchange ratio, the model developed by Conn & Nielson is used. Correct Answer True Your Answer True Multiple Choice Single Answer Question One of the important assumptions for capital structure theories is :Correct Answer Debt and equity are the 2 kinds of funds used by the firm Your Answer Debt and equity are the 2 kinds of funds used by the firm Select The Blank Question ________ are not diversible. Correct Answer Market related risks Your Answer Market related risks Multiple Choice Multiple Answer Question The financial managers of a company consume a great deal of their time in activities like :Correct Answer Monitoring the investment in inventories , Negotiating favourable credit terms , Administrating Accounts receivables Your Answer Monitoring the investment in inventories , Negotiating favourable credit terms , Administrating Accounts receivables

LIST OF ATTEMPTED QUESTIONS AND ANSWERS

Multiple Choice Multiple Answer Question The different types of floats are :Correct Answer Postal float , Deposit float , Bank float Your Answer Postal float , Deposit float , Bank float Multiple Choice Single Answer Question A low payout policy implies :Correct Answer More retention of profits Your Answer More retention of profits True/False Question optimum cash balance under certainty i.e. Baumul`s model allows the cash flow to fluctuate. Correct Answer False Your Answer True Multiple Choice Single Answer Question Companies often need to value its own :Correct Answer Shares Your Answer Liabilities Select The Blank Question Postage is an example of ________ cost. Correct Answer Non traceable cost Your Answer Non traceable cost Multiple Choice Single Answer Question Value added analysis :Correct Answer

Helps to identify potential activities that may be omitted immediately Your Answer Helps to identify potential activities that may be omitted immediately Multiple Choice Multiple Answer Question Intangible assets include :Correct Answer Preliminary expenses , Deferred revenue expenditure , Discount on issues of shares / debenture etc Your Answer Preliminary expenses , Deferred revenue expenditure , Discount on issues of shares / debenture etc Multiple Choice Single Answer Question The Management of the Company may enter into a negotiated purchase, which is referred to as :Correct Answer Greenfield Your Answer Forward Contracts Multiple Choice Single Answer Question If the segment result of a segment includes interest expense its segment liabilities include :Correct Answer The related interest bearing liabilities Your Answer The related interest bearing liabilities Select The Blank Question As per NOI Approach - the overall capitalization rate remains ________ for all levels of financial leverage. Correct Answer Constant Your Answer Constant Match The Following Question Correct Answer Your Answer Exit cost Lost efficiency prior to separation, Job vacancy cost during the new search & termination pay. Lost efficiency prior to separation, Job vacancy cost during the new search & termination pay.

Historical costs Sacrifice necessary to hire & train people Sacrifice necessary to hire & train people Substitution cost Exit costs of the leaving employee & recruiting & training of the replacement Exit costs of the leaving employee & recruiting & training of the replacement Opportunity cost An asset value when they are the target of an alternative use. An asset value when they are the target of an alternative use. Multiple Choice Single Answer Question Suppliers of equity are interested in :Correct Answer High share prices Your Answer High share prices Multiple Choice Multiple Answer Question The 3 groups of participants in a firm are :Correct Answer Suppliers of equity , Debt suppliers , Firm Managers Your Answer Suppliers of equity , Debt suppliers , Firm Managers True/False Question It is possible to place a single value for the acquired firm. Correct Answer False Your Answer True Select The Blank Question ________ is never a part of the output. Correct Answer Mechanisms Your Answer Mechanisms Multiple Choice Multiple Answer Question Exit costs are classified into 3 categories namely :Correct Answer

Lost efficiency prior to separation , Job vacancy cost during the new search , Termination pay Your Answer Recruiting new employee as a replacement of the left employee , Lost efficiency prior to separation , Termination pay True/False Question A transport corporation has a substantial working capital requirement. Correct Answer False Your Answer True Select The Blank Question ________ know the best about a firm's performance. Correct Answer Firm Managers Your Answer Business analysts Multiple Choice Multiple Answer Question As per AS 13 Statement, the following are not considered as investments:Correct Answer Shares , Debentures , Other securities held as stock in trade Your Answer Shares , Debentures , Other securities held as stock in trade Multiple Choice Multiple Answer Question The employer in offering the job contract assumes a range of legal obligations such as :Correct Answer Rewards - cash like & non cash like , Health & safety policies , Pensions & contributions to social security payments Your Answer Rewards - cash like & non cash like , Health & safety policies , Pensions & contributions to social security payments True/False Question It is essential that ABC must fit into the strategy of the company. Correct Answer True Your Answer False

True/False Question Trade credit creates book debts which the firm is expected to collect in the near future. Correct Answer True Your Answer True Select The Blank Question At times managers invest in projects that improve the company's ________. Correct Answer Prestige or power Your Answer Prestige or power Select The Blank Question Business risk & financial risk do not have any influence on ________. Correct Answer Accounting numbers Your Answer Banks True/False Question The objective of a dividend policy should be to maximize shareholder's return so that the value of his investment is maximized. Correct Answer False Your Answer True True/False Question A change in the method of depreciation is treated as a change in an accounting policy and is disclosed accordingly. Correct Answer True Your Answer True Select The Blank Question ________ is not a characteristic of financial conglomerates.

Correct Answer Provide ineffective competitive process Your Answer Provide ineffective competitive process Select The Blank Question There is a ________ relationship between the number of employees & the use of operating supplies. Correct Answer Natural Your Answer Natural Multiple Choice Single Answer Question If a firm opts for restrictive policy then the investments in current assets is :Correct Answer Low Your Answer Low Match The Following Question Correct Answer Your Answer AS 17 Segment reporting Segment reporting AS 19 Leases Leases AS 6 Depreciation accounting Depreciation accounting AS 10 Accounting for fixed assets Revenue recognition True/False Question To `gather costs', means capturing all relevant expenses that pertain to the selected model and processes. Correct Answer True Your Answer

True Select The Blank Question Investors can reduce the company related risk by diversification of their investments in ________. Correct Answer Shares of a large number of companies Your Answer Fixed deposits of a company Multiple Choice Multiple Answer Question For ABC Analysis the available cost data :Correct Answer Has to be adjusted for change , Has to be corrected for undocumented element costs , Has to be combined with different types of data from alternate sources Your Answer Has to be adjusted for change , Has to be corrected for undocumented element costs , Has to be combined with different types of data from alternate sources Multiple Choice Multiple Answer Question The external staffing performance indicators include :Correct Answer Compensation per Re. Profit , Personnel services head count , Profit per head Your Answer Compensation per Re. Profit , Personnel services head count , Profit per head Select The Blank Question HLL the largest FMCG company has a turnover of Rs. ________. Correct Answer 118 Bn Your Answer 118 Bn Select The Blank Question Segment expense includes ________. Correct Answer The relevant portion of enterprise revenue that can be allocated on a reasonable basis to a segment Your Answer The relevant portion of enterprise revenue that can be allocated on a reasonable basis to a segment

Multiple Choice Multiple Answer Question The important aspect of dividend policy is :Correct Answer To determine the amount of earnings to be distributed to shareholders , Amount to be retained in the firm Your Answer To determine the amount of earnings to be distributed to shareholders , Amount to be retained in the firm , To dispatch the dividend warrants in time Select The Blank Question In today's fast moving world, the quickest way to get information on a firm is through ________. Correct Answer Internet Your Answer Internet Multiple Choice Multiple Answer Question The main characteristics of operating economies are :Correct Answer It is achieved through horizontal, vertical and conglomerate mergers , It occurs due to indivisibilities of resources , It is possible in generic management functions Your Answer It is achieved through horizontal, vertical and conglomerate mergers , It occurs due to indivisibilities of resources , It is possible in generic management functions Multiple Choice Single Answer Question Segment liabilities do not include :Correct Answer Borrowings & other liabilities that are incurred for financing rather than operating purpose Your Answer Borrowings & other liabilities that are incurred for financing rather than operating purpose Multiple Choice Single Answer Question Which of the following company is reaping high market valuation due to showing human resources as an asset in its balance sheet information? Correct Answer Infosys Your Answer Infosys

True/False Question In market value approach, interested parties never manipulate the stock markets. Correct Answer False Your Answer False Multiple Choice Single Answer Question The stock value for a company will be considered to be fair value for ordinary transactions if the shares are :Correct Answer Listed Your Answer Listed True/False Question Planning helps an acquiring firm to identify the units it should drop & it should add. Correct Answer True Your Answer True Multiple Choice Single Answer Question For paying dividends, firms will have a given amount of :Correct Answer Cash available Your Answer Cash available Multiple Choice Single Answer Question The depreciation rates or the useful lives of the assets are disclosed only :Correct Answer If they are different from the principle rates specified in the statute Your Answer If specifically asked by the Chartered accountant of the company Select The Blank Question Earning power of the company approach tries to value the ________. Correct Answer Current value of the assets

Your Answer Current value of the assets at 4:55 AM 1 comments Links to this post Labels: Strategic Finance

Strategic Finance - 1
LIST OF ATTEMPTED QUESTIONS AND ANSWERS

Multiple Choice Single Answer Question One of the selective developments that has taken place in recent times is companies are going in for :Correct Answer Activity based costing and management Your Answer Activity based costing and management True/False Question Diversification helps in preserving a firm's reputation & goodwill. Correct Answer True Your Answer True True/False Question Cash dividends are taxable at ordinary tax rates. Correct Answer True Your Answer True Multiple Choice Multiple Answer Question The 3 groups of participants in a firm are :Correct Answer Suppliers of equity , Debt suppliers , Firm Managers Your Answer Suppliers of equity , Debt suppliers , Firm Managers

Multiple Choice Multiple Answer Question As per AS 13 Statement, the following are not considered as investments:Correct Answer Shares , Debentures , Other securities held as stock in trade Your Answer Shares , Debentures , Other securities held as stock in trade Match The Following Question Correct Answer Your Answer Opportunity cost An asset value when they are the target of an alternative use. An asset value when they are the target of an alternative use. Exit cost Lost efficiency prior to separation, Job vacancy cost during the new search & termination pay. Lost efficiency prior to separation, Job vacancy cost during the new search & termination pay. Historical costs Sacrifice necessary to hire & train people Sacrifice necessary to hire & train people Substitution cost Exit costs of the leaving employee & recruiting & training of the replacement Exit costs of the leaving employee & recruiting & training of the replacement Multiple Choice Multiple Answer Question The acquiring firm for any M & A will require data about the target firm which will include :Correct Answer Quality of management , Production capabilities , Profitability Your Answer Quality of management , Production capabilities , Profitability Multiple Choice Single Answer Question Equity includes :Correct Answer Development Rebate Reserve Your Answer Development Rebate Reserve Match The Following Question Correct Answer Your Answer Free cash flow theory

Enormous conflicts of interest between Stakeholders and shareholders Enormous conflicts of interest between Stakeholders and shareholders Net income approach Cost of debt & equity do not change with a change in leverage ratio Cost of debt & equity do not change with a change in leverage ratio Net operating income approach The overall capitalization rate remains constant for all levels of financial leverages The overall capitalization rate remains constant for all levels of financial leverages Modigliani - Miller Theory weighted average cost of capital does not change with a change in the proportion of debt to equity in the capital structure weighted average cost of capital does not change with a change in the proportion of debt to equity in the capital structure Select The Blank Question If a segment is not designated as a ________ it should be included as an unallocated reconciling item. Correct Answer Reportable segment Your Answer Reportable segment True/False Question For determining exchange ratio, the model developed by Conn & Nielson is used. Correct Answer True Your Answer True Select The Blank Question In presenting the reconciliation segment result should be reconciled to ________. Correct Answer Enterprise net profit or loss Your Answer Enterprise net profit or loss Select The Blank Question Identify disclosure on human resources as a societal concern & prepare international regulations comes under ________ Correct Answer The compulsory method Your Answer

The compulsory method Multiple Choice Single Answer Question Which is an example out of the following to which special consideration apply for depreciation :Correct Answer Regenerative natural resources Your Answer Regenerative natural resources True/False Question It is essential that ABC must fit into the strategy of the company. Correct Answer True Your Answer True Select The Blank Question HLL the largest FMCG company has a turnover of Rs. ________. Correct Answer 118 Bn Your Answer 118 Bn Select The Blank Question There is a ________ relationship between the number of employees & the use of operating supplies. Correct Answer Natural Your Answer Natural Multiple Choice Multiple Answer Question The important aspect of dividend policy is :Correct Answer To determine the amount of earnings to be distributed to shareholders , Amount to be retained in the firm Your Answer To determine the amount of earnings to be distributed to shareholders , Amount to be retained in the firm Multiple Choice Multiple Answer

Question The main characteristics of CAPM are :Correct Answer It is an equilibrium Model , It describes the pricing of assets as well as derivatives , Expected security return = Riskless return + beta x (expected market risk premium) Your Answer It is an equilibrium Model , It describes the pricing of assets as well as derivatives , Expected security return = Riskless return + beta x (expected market risk premium) True/False Question Current accounting system is able to provide actual value of employee capabilities & knowledge. Correct Answer False Your Answer False Multiple Choice Single Answer Question In respect of depreciable assets, which do not have material value, depreciation is often allocated :Correct Answer Fully in the accounting period for which they are acquired Your Answer Fully in the accounting period for which they are acquired Multiple Choice Single Answer Question The depreciation rates or the useful lives of the assets are disclosed only :Correct Answer If they are different from the principle rates specified in the statute Your Answer If they are different from the principle rates specified in the statute Multiple Choice Multiple Answer Question Due to diversification employees seek:Correct Answer Job security , Better opportunities within the firm , Higher compensation Your Answer Job security , Better opportunities within the firm , Higher compensation Select The Blank Question The ________ cost tier has the advantage of being the simplest to calculate and justify. Correct Answer

Direct Your Answer Direct Multiple Choice Multiple Answer Question To gather costs means to do the following actions to support the costing of the activities :Correct Answer To capture , To construct , To synthesize the correct cost figures Your Answer To capture , To construct , To synthesize the correct cost figures True/False Question Odd lots purchase is not a method of buy back of shares. Correct Answer False Your Answer False Multiple Choice Multiple Answer Question The overhead expenses include :Correct Answer Utilities , Maintenance , Security Your Answer Utilities , Maintenance , Security Multiple Choice Single Answer Question In a matching approach policy, :Correct Answer There is a small risk if shortage of funds Your Answer There is a small risk if shortage of funds Multiple Choice Single Answer Question The most important internal sources of financing the growth of the firm is through :Correct Answer Retained earnings Your Answer Retained earnings True/False Question

The intellectual assets of a company are often worth 3 or 4 times the tangible book value. Correct Answer True Your Answer True Multiple Choice Multiple Answer Question Indicators of the value of an investment are obtained by :Correct Answer Reference to its market value , The investee`s assets , The expected cash flows from the investment Your Answer Reference to its market value , The investee`s assets , The expected cash flows from the investment Select The Blank Question Buy back through book building the process should be made through ________. Correct Answer An electronically linked transparent facility Your Answer An electronically linked transparent facility Multiple Choice Multiple Answer Question Significant influence is the power to :Correct Answer Participate in the operating policy decisions , Participate in the financial decisions Your Answer Participate in the financial decisions , Participate in the operating policy decisions True/False Question An activity model is a tool to assist in understanding & defining the organisation. Correct Answer True Your Answer True True/False Question Decisions related to working capital are repetitive & frequent. Correct Answer True Your Answer

True Select The Blank Question ________ is not a characteristic of financial conglomerates. Correct Answer Provide ineffective competitive process Your Answer Provide ineffective competitive process Multiple Choice Single Answer Question In the past, costing mainly focused on :Correct Answer Manufacturing costs Your Answer Manufacturing costs Multiple Choice Multiple Answer Question A firm using a conservative policy for determining the requirements of current assets :Correct Answer Has fewer production stoppages , Ensures quick deliveries to customers , Stimulates sales Your Answer Has fewer production stoppages , Ensures quick deliveries to customers , Stimulates sales Multiple Choice Multiple Answer Question The major conditions to be fulfilled for buyback of shares as per the legal provisions include :Correct Answer Articles of association should authorize buyback of shares , The shares which are sought to be bought back should be fully paid up , After the buy back the ratio of debt to total capital and free reserves should not be more than 2 : 1 Your Answer Articles of association should authorize buyback of shares , The shares which are sought to be bought back should be fully paid up , After the buy back the ratio of debt to total capital and free reserves should not be more than 2 : 1 Multiple Choice Single Answer Question Segment liabilities do not include :Correct Answer Borrowings & other liabilities that are incurred for financing rather than operating purpose Your Answer Borrowings & other liabilities that are incurred for financing rather than operating purpose

Multiple Choice Single Answer Question The difference between current assets & current liabilities is known as :Correct Answer Net working capital Your Answer Net working capital Multiple Choice Single Answer Question The bottom line of ABC Process is :Correct Answer To achieve a better method of doing the right business pf the organisation Your Answer To achieve a better method of doing the right business pf the organisation Select The Blank Question Non value added activities helps ________. Correct Answer To analyse the activities more carefully Your Answer To analyse the activities more carefully Multiple Choice Single Answer Question In value of assets method the following is also to be included as they are also of value to the company :Correct Answer Non trading assets Your Answer Non trading assets Multiple Choice Single Answer Question Best practices, a tool for review process is similar to :Correct Answer Bench marking Your Answer Bench marking Select The Blank Question HLL is ________ % of subsidiary of Unilever PLC. Correct Answer 0.516

Your Answer 0.516 Select The Blank Question traditionally avails are provided by ________. Correct Answer Banks Your Answer Banks