Classical

Financial Accounting - Financial Accounting MCQ

41:  

Scruting of financial transactions is called

A.

Budgeting

B.

Auditing

C.

Programming

D.

Accounting

 
 

Option: B

Explanation :


42:  
The presence of fixed costs in the total cost structure of a firm results into
A.

Financial Leverage

B.

Operating Leverage

C.

Super Leverage

D.

None of the above.

 
 

Option: B

Explanation :


43:  
A view that dividend policy of a firm has a bearing on share valuation advocated by James E. Walter is based on which one of the following assumptions.
A.

Retained earning is only source of financing

B.

Cost of capital does not remain constant

C.

Return of investment function

D.

All of the above.

 
 

Option: A

Explanation :


44:  
Match List-I with List-II and select the correct answer using the codes given below the lists:
     List-I                                                                   List-II
a. Modigiiani-Miller approach                         I. Commercial  Paper
b. Net operating income approach               ll. Working capital
c. Short term money market instrument     Ill. Capital Structure
d. Factoring                                                       IV. Arbitrage

 

A.

 a   b    c    d

 IV  III    I     II

B.

 a   b    c    d

 III  IV    I     II

C.

 a   b    c    d

 III  II    I     IV

D.

 a   b    c    d

 IV  II    III    I

 
 

Option: B

Explanation :


45:  
Which of the following is not followed in capital budgeting?
A.

Cash flows principle

B.

Interest Exclusion Principle

C.

Accrual Principle

D.

Post-tax Principle

 
 

Option: C

Explanation :




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