vu acc501 Final Term - Quiz No.1
vu acc501 Business Finance Quiz
This quiz belongs to book/course code vu acc501 Business Finance of vu organization. We have 30 quizzes available related to the book/course Business Finance. This quiz has a total of 10 multiple choice questions (MCQs) to prepare and belongs to topic Final Term. NVAEducation wants its users to help them learn in an easy way. For that purpose, you are free to prepare online MCQs and quizzes.
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Question 1: Which of the following is a non-cash item?
Tax
Depreciation
Account Receivables
All of the given
Question 2: Standard deviations for Investment A and Investment B are 25% and 12% respectively. This indicates that :
Investment A is less volatile than Investment B
Investment B is equally volatile to Investment A
Investment A is more volatile than Investment B
Investment B is more volatile than Investment A
Question 3: Suppose that Pearson Corporation has a capital structure which consists of both equity and debt. It had issued two million worth of bonds at 6.5 % p.a. The tax rate is 40%. Its EBIT is one million. The present value of tax shield for Pearson corporation would be
Rs.1,000,000
Rs.1,200,000
Rs800,000
Rs.1,400,000
Question 4: Which of the following statement is TRUE regarding debt?
Debt is an ownership interest in the firm.
Unpaid debt can result in bankruptcy or financial failure.
Debt provides the voting rights to the bondholders.
Corporation's payment of interest on debt is fully taxable.
Question 5: __________ is the market in which already issued securities are traded among investors.
Primary market
Secondary market
Financial market
Capital market
Question 6: Which of the following cash flow activities are reported in the Cash Flow Statement and Income Statement?
Operating Activities
Investing Activities
Financing Activities
All of the given options
Question 7: Agency problems can be controlled by which of the way?
Monitor what the agent is doing
Employ auditors to review company books to make sure funds are used properly
Pay bonus share to manager as compensation plan
All of the given
Question 8: According to Section 236, Director's report should be attached to which of the following financial statement?
Balance sheet
Profit and loss account
Statement of retained earnings
Statement of cash flows
Question 10: Which statement is true about the relationship between weighted average cost of capital and value of a firm in the eyes of investors?
They have a direct relationship
They have an indirect relationship
They have spontaneous relationship
None of the given options
