Classical

Financial and Management Accounting - Financial and Management Accounting Objective Type Questions

46:  
With regard to the rate of return on investment (ROI), which of the following statements is not valid?
A.
It is an overall indicator of the profitability of an enterprise.
B.
It is a triangular relationship in the sense that ROI = Profit margin x Asset turnover
C.
It is a superior measure compared to the cash flow generated per share.
D.

It was first developed by Du Pont, USA

 
 

Option: C

Explanation :


47:  

Match List-I with List-II and select the correct answer using the codes given below the lists:

     List-I                                                                                  List-II

a. Current assets ÷ Current liabilities                     I. Performance of equity capital

b. Fixed assets ÷  Long-term funds                        II Short-term  solvency

c. Debt ÷ Equity                                                           Ill. Capital Structure

d. Earnings after interest and taxes ÷ Number    IV. Overall Performance

 of  shares issued                                                      V. Long-term solvency

 

A.

 a   b   c    d

 II   V    III   IV

B.

a  b   c    d

I   II   III   IV

C.

a  b   c    d

II   V   IV   III

D.

a  b   c    d

I   II   IV   III

 
 

Option: A

Explanation :


48:  
A company with a paid up capital of 5000 equity shares of Rs. 10 each has a turnover of four times with a margin of 8% on sales. The ROI of the company will be
A.

28%

B.

32%

C.

35%

D.

42%

 
 

Option: B

Explanation :


49:  
Comparison of financial variables of a business enterprise over a period of time is called
A.

Intra-firm analysis

B.

Inter-firm analysis

C.

Standard analysis

D.

Vertical analysis

 
 

Option: A

Explanation :


50:  
What is the correct sequence of the following items of current assets in the balance sheet of a company as per the Companies Act, 1956?
1. Cash balance in hand
2. Interest accrued on investments
3. Stores and spare parts
4. Loose tools
5. Sundry debtors
6. Stock-in-trade
7. Work-in-progress
Select the correct answer using the codes given below:
A.

2,5,4,6,7,3,1

B.

1,2,4,3,5,7,6

C.

7,6,4,1,2,5,3

D.

2,3,4,6,7,5,1

 
 

Option: D

Explanation :




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