Classical

Financial Management - FInancial Management Questions

31:  

Dual classes of ________ are common in new ventures where promotional ________ usually goes to the founders.

A.

bonds; bonds

B.

preferred stock; preferred stock

C.

common stock; common stock

D.

warrants; warrants

 
 

Option: C

Explanation :


32:  

The dividend on equity shares is only paid when dividend on _______ has already been paid.

A.

Debenture

B.

Preference Share

C.

Bond

D.

Equity Shares

 
 

Option: B

Explanation :


33:  

Cost of Equity Capital and Retained Earnings can be computed by

A.

Ke = D1/P0 + g

B.

Ke =  Dividend/P0

C.

Ke = g/D1 x 100

D.

Ke = D1/S1 (1 - tax)

 
 

Option: B

Explanation :


34:  

The Company's return on Capital employed can be computed by

A.

EBIT/Total Assets - current liabilities

B.

Sales/Cash x 100

C.

EBIT/Assets

D.

EBIT/EBT

 
 

Option: A

Explanation :


35:  

Debt Equity Ratio is computed by

A.

Reserve/Capital

B.

Reserve + Capital + Loss/2

C.

Assets/Current Assets

D.

Total Liabilities/Shareholders Equity

 
 

Option: D

Explanation :




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