Financial Management MCQ

Financial Management MCQ | Freshers & Experienced

  • Sharad Jaiswal
  • 12th Feb, 2021

We have listed below the best Financial Management MCQ Questions for your basic knowledge of Financial Management. This Financial Management MCQ Test contains 25 multiple Choice Questions. You have to select the right answer to every question.

Financial Management MCQ

1) ________is the limitation of Traditional approach of Financial Management.

  • A. One-sided approach
  • B.Ignores allocation of resources
  • C.More emphasis on long term problems
  • D.All of the above

2) Financial management process deals with

  • A. Investments
  • B.Financing decisions
  • C.Assets
  • D.None of the above

3) Cost of retained earnings is equal to:

  • A. return on existing common stock
  • B.return on preferred stock
  • C.return on new common stock
  • D.All of the above

4) The Primary goal of financial management?

  • A. raise profit
  • B.minimize the risk
  • C.maximize the return
  • D.maximize the owner’s wealth

5) The cost of debt capital is calculated on the basis:

  • A. Capital
  • B.Annual Interest
  • C.Annual Depreciation
  • D.Net proceeds

6) Dividend Payout Ratio is_______

  • A. DPS ÷ EPS
  • B.PAT÷ Capital
  • C.Pref. Dividend ÷ PAT
  • D.Pref. Dividend ÷ Equity Dividend

7) Financial management mainly focuses on_______.

  • A. Brand dimension
  • B.Arrangement of funds
  • C.Efficient management of every business
  • D.Elements of acquiring and using means of financial resources

8) Which of the following is not a financial investment.

  • A. Reduced expenses.
  • B.Marketable
  • C.Manage portfolios
  • D.Pooled investments.

9) A Capital investment is one that_______

  • A. has the prospect of long-term benefits.
  • B.has the prospect of short-term benefits.
  • C.is only undertaken by large corporations
  • D.applies only to investment in fixed assets

10) Heterogeneous cash flows can be made comparable by

  • A. Discounting technique
  • B.Compounding technique
  • C.Dimension technique
  • D.Both A & B

11) Which of the following is the goal of financial management.

  • A. the wealth of Debenture holders
  • B.the wealth of Preference Shareholders
  • C.the wealth of Equity shareholders
  • D.None of the above

12) Which of the following is capital employed?

  • A. Cash + Bank
  • B.Assets + Cash
  • C.Shareholders Funds + Long Funds
  • D.Both A & B

13) Which is the limitation of Traditional approach of Financial Management?

  • A. One-sided approach
  • B.Ignores allocation of resources
  • C.More emphasis on long term problems
  • D.All of the above

14) Factoring involves______

  • A. Sales ledger management
  • B.credit investigation
  • C.Sales ledger management
  • D.All of the above

15) Which form of financing in reserve and surplus are:

  • A. Loans Financing
  • B.Internal Financing
  • C.Security Financing
  • D.International Financing

16) Financial management process deals with

  • A. Financing decisions
  • B.Funds
  • C.Investments
  • D.All of the above

17) What is factoring?

  • A. Cost of Sales
  • B.Production Plan
  • C.New Financial Service
  • D.None of the above

18) Current assets are also referred to as:

  • A. Inventory
  • B.Livestock
  • C.Investments
  • D.Working capital

19) Ke = DPS/MP x 100, is used for______

  • A. Depreciation
  • B.Reserve
  • C.capital structure
  • D.Equity Share Capital

20) Networking capital means:

  • A. current assets minus current liabilities
  • B.current assets minus inventories
  • C.total assets minus fixed assets.
  • D.current assets.

21) Long period of Bond maturity lends to:

  • A. Stable Prices
  • B.Mature Prices
  • C.Standing Prices
  • D.More Price change

22) The market value of the shares is decided by

  • A. government
  • B.shareholders
  • C.investment market
  • D.respective companies

23) Company cost of capital is called_______

  • A. Risk rate
  • B.Hurdle rate
  • C.Leverage
  • D.Return rate

24) Beta is measures the_______

  • A. Market risk
  • B.Financial risk
  • C.Investment risk rate
  • D.Market and finance risk

25) In Walter model formula D stands for:

  • A. Direct earnings
  • B.Dividend per share
  • C.Direct dividend.
  • D.Debentures.

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