July 2016 - Paper2

31:   Which of the following is not a feature of payback period method ?
A.

It is simply a method of cost recovery and not of profitability.

B.

It does not consider the time value of money.

C.

It does not consider the risk associated with the projects.

D.

It is very difficult to calculate.

 
 

Option: B

Explanation :

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32:   Which of the following is not a source of credit information of prospective customers ?
A.

Letter of credit

B.

Bank Reference

C.

Trade Enquiry

D.

Credit Bureau

 
 

Option: D

Explanation :

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33:  

The portion of earnings which is distributed among shareholders in the form of dividend is called

A.

Proprietary Ratio

B.

Earnings-yield Ratio

C.

Payout Ratio

D.

Retention Ratio

 
 

Option: B

Explanation :

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34:  

Select the correct code regarding motives for holding inventories by firms : (a) Transaction motive (b) Environmental motive (c) Precautionary motive (d) Speculative motive (e) Competitive motive

A.

(a), (b), (c), (d)

B.

(a), (b), (d), (e)

C.

(a), (d), (e)

D.

(a), (c), (d)

 
 

Option: B

Explanation :

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35:  

Which of the following formulae is related to operating leverage ?

A.

commerce

B.

commerce

C.

commerce

D.

All of the above

 
 

Option: B

Explanation :

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