MCQOPTIONS
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MCQOPTIONS
This section includes 2436 Mcqs, each offering curated multiple-choice questions to sharpen your Commerce knowledge and support exam preparation. Choose a topic below to get started.
| 151. |
In stock dividend: |
| A. | Authorized capital always increases |
| B. | Paid up capital always increases |
| C. | Face value per share decreases |
| D. | Market price for share decreases |
| Answer» E. | |
| 152. |
Which of the following is not relevant for dividend payment for a year ? |
| A. | Cash flow position |
| B. | Profit position, |
| C. | Paid up capital, |
| D. | Retained Earnings |
| Answer» E. | |
| 153. |
Cash Budget does not include |
| A. | Dividend Payable |
| B. | Postal Expenditure, |
| C. | Issue of Capital, |
| D. | Total Sales Figure. |
| Answer» E. | |
| 154. |
Which of the following is not a motive to hold cash? |
| A. | Transactionary Motive, |
| B. | Pre-scautionary Motive, |
| C. | Captal Investment, |
| D. | None of the above. |
| Answer» D. None of the above. | |
| 155. |
Difference between between the bank balance as per Cash Book and Pass Book maybe due to: |
| A. | Overdraft, |
| B. | Float, |
| C. | Factoring, |
| D. | None of the above. |
| Answer» C. Factoring, | |
| 156. |
Cheques deposited in bank may not be available for immediate use due to |
| A. | Payment Float |
| B. | Recceipt Float |
| C. | Net Float, |
| D. | Playing the Float. |
| Answer» C. Net Float, | |
| 157. |
Concentration Banking helps in |
| A. | Reducing Idle Bank Balance |
| B. | Increasing Collection, |
| C. | Increasing Creditors, |
| D. | Reducing Bank Transactions. |
| Answer» C. Increasing Creditors, | |
| 158. |
The Transaction Motive for holding cash is for |
| A. | Safety Cushion |
| B. | Daily Operations, |
| C. | Purchase of Assets |
| D. | Payment of Dividends. |
| Answer» C. Purchase of Assets | |
| 159. |
Miller-Orr Model deals with |
| A. | Optimum Cash Balance, |
| B. | Optimum Finished goods, |
| C. | Optimum Receivables, |
| D. | All of the above. |
| Answer» B. Optimum Finished goods, | |
| 160. |
Which of the following is not an objective of cash management ? |
| A. | Maximization of cash balance |
| B. | Minimization of cash balance |
| C. | Optimization of cash balance |
| D. | Zero cash balance. |
| Answer» D. Zero cash balance. | |
| 161. |
Float management is related to |
| A. | Cash Management, |
| B. | Inventory Management, |
| C. | Receivables Management, |
| D. | Raw Materials Management |
| Answer» B. Inventory Management, | |
| 162. |
Which of the following is not true of cash budget ? |
| A. | Cash budget indicates timings of short-term borrowing, |
| B. | Cash budget is based on accrual concept |
| C. | Cash budget is based on cash flow concept |
| D. | Repayment of principal amount of law is shown in cash budget. |
| Answer» C. Cash budget is based on cash flow concept | |
| 163. |
Marketable securities are primarily |
| A. | Equity shares,' |
| B. | Preference shares, |
| C. | Fixed deposits with companies |
| D. | Short-term debt investments. |
| Answer» E. | |
| 164. |
Which of the following is not an element of credit policy? |
| A. | Credit Terms |
| B. | Collection Policy |
| C. | Cash Discount Terms, |
| D. | Sales Price |
| Answer» E. | |
| 165. |
5Cs of the credit does not include |
| A. | Collateral |
| B. | Character, |
| C. | Conditions, |
| D. | None of the above |
| Answer» E. | |
| 166. |
Ageing schedule incorporates the relationship between |
| A. | Creditors and Days Outstanding |
| B. | Debtors and Days Outstanding |
| C. | Average Age of Directors, |
| D. | Average Age of All Employees. |
| Answer» C. Average Age of Directors, | |
| 167. |
Bad debt cost is not borne by factor in case of |
| A. | Pure Factoring |
| B. | Without Recourse Factoring, |
| C. | With Recourse Factoring |
| D. | None of the above |
| Answer» D. None of the above | |
| 168. |
Which of the following is not a part of credit policy? |
| A. | Collection Effort |
| B. | Cash Discount, |
| C. | Credit Standard |
| D. | Paying Practices of debtors. |
| Answer» E. | |
| 169. |
Which of the following is not a technique of receivables Management? |
| A. | Funds Flow Analysis |
| B. | Ageing Schedule, |
| C. | Days sales outstanding |
| D. | Collection Matrix. |
| Answer» B. Ageing Schedule, | |
| 170. |
Which is not a service of a factor? |
| A. | Administrating Sales Ledger |
| B. | Advancing against Credit Sales, |
| C. | Assuming bad debt losses, |
| D. | None of the above. |
| Answer» E. | |
| 171. |
Credit Policy of a firm should involve a trade-off between increased |
| A. | Sales and Increased Profit |
| B. | Profit and Increased Costs of Receivables, |
| C. | Sales and Cost of goods sold, |
| D. | None of the above. |
| Answer» C. Sales and Cost of goods sold, | |
| 172. |
Out of the following, what is not true in respect of factoring? |
| A. | Continuous Arrangement between Factor and Seller, |
| B. | Sale of Receivables to the factor, |
| C. | Factor provides cost free finance to seller |
| D. | None of the above. |
| Answer» D. None of the above. | |
| 173. |
Payment to creditors is a manifestation of cash held for: |
| A. | Transactionery Motive, |
| B. | Precautionary Motive, |
| C. | Speculative Motive, |
| D. | All of the above. |
| Answer» B. Precautionary Motive, | |
| 174. |
If the average balance of debtors has increased, which of the following might notshow a change in general? |
| A. | Total Sales, |
| B. | Average Payables |
| C. | Current Ratio |
| D. | Bad Debt loss |
| Answer» C. Current Ratio | |
| 175. |
If the closing balance of receivables is less than the opening balance for a month thenwhich one is true out of |
| A. | Collections>Current Purchases, |
| B. | Collections>Current Sales, |
| C. | Collections<Current Purchases, |
| D. | Collections < Current Sales. |
| Answer» C. Collections<Current Purchases, | |
| 176. |
Securitization is related to conversion of |
| A. | Receivables, |
| B. | Stock, |
| C. | Investments, |
| D. | Creditors. |
| Answer» B. Stock, | |
| 177. |
80% of sales of 10,00,000 of a firm are on credit. It has a Receivable Turnover of 8.What is the Average collection period (360 days a year) and Average Debtors of the firm? |
| A. | 45 days and 1,00,000 |
| B. | 360 days and 1,00,000, |
| C. | 45 days and 8,00,000 |
| D. | 360 days and 1,25,000 |
| Answer» B. 360 days and 1,00,000, | |
| 178. |
In response to market expectations, the credit pence r j been increased from 45 days to60 days. This would result in |
| A. | Decrease in Sales, |
| B. | Decrease in Debtors, |
| C. | Increase in Bad Debts, |
| D. | Increase in Average Collection Period. |
| Answer» E. | |
| 179. |
If a company sells its receivable to another party to raise funds, it is known as |
| A. | Securitization |
| B. | Factoring, |
| C. | Pledging |
| D. | None of the above. |
| Answer» C. Pledging | |
| 180. |
Cash Discount term 3/15, net 40 means |
| A. | 3% Discount if payment in 15 days, otherwise full payment in 40 days, |
| B. | 15% Discount if payment in 3 days, otherwise full payment 40 days, |
| C. | 3% Interest if payment made in 40 days and 15%,interest thereafter, |
| D. | None of the above. |
| Answer» B. 15% Discount if payment in 3 days, otherwise full payment 40 days, | |
| 181. |
If the sales of the firm are . 60,00,000 and the average debtors are . 15,00,000 thenthe receivables turnover is |
| A. | 4 times |
| B. | 25% |
| C. | 400% |
| D. | 0.25 times |
| Answer» B. 25% | |
| 182. |
If cash discount is offered to customers, then which of the following would increase? |
| A. | Sales |
| B. | Debtors |
| C. | Debt collection period |
| D. | All of the above |
| Answer» B. Debtors | |
| 183. |
Receivables Management deals with |
| A. | Receipts of raw materials |
| B. | Debtors collection, |
| C. | Creditors Management |
| D. | Inventory Management |
| Answer» C. Creditors Management | |
| 184. |
Which of the following is true for a company which uses continuous review inventorysystem |
| A. | Order Interval is fixed |
| B. | Order Interval varies, |
| C. | Order Quantity is fixed |
| D. | Both (a) and (c) |
| Answer» D. Both (a) and (c) | |
| 185. |
Which of the following is related to Receivables Management? |
| A. | Cash Budget |
| B. | Economic Order Quantity, |
| C. | Ageing schedule |
| D. | All of the above. |
| Answer» D. All of the above. | |
| 186. |
EOQ is the quantity that minimizes |
| A. | Total Ordering Cost |
| B. | Total Inventory Cost, |
| C. | Total Interest Cost |
| D. | Safety Stock Level |
| Answer» B. Total Inventory Cost, | |
| 187. |
If no information is available, the General Rule for valuation of stock for balancesheet is |
| A. | Replacement Cost |
| B. | Realizable Value, |
| C. | Historical Cost |
| D. | Standard Cost |
| Answer» D. Standard Cost | |
| 188. |
In ABC inventory management system, class A items may require |
| A. | Higher Safety Stock |
| B. | Frequent Deliveries |
| C. | Periodic Inventory system |
| D. | Updating of inventory records. |
| Answer» B. Frequent Deliveries | |
| 189. |
Inventory holding cost may include |
| A. | Material Purchase Cost |
| B. | Penalty charge for default, |
| C. | Interest on loan, |
| D. | None of the above |
| Answer» E. | |
| 190. |
Use of safety stock by a firm would |
| A. | Increase Inventory Cost |
| B. | Decrease Inventory Cost, |
| C. | No effect on cost |
| D. | None of the above |
| Answer» B. Decrease Inventory Cost, | |
| 191. |
ABC Analysis is useful for analyzing the inventories: |
| A. | Based on their Quality |
| B. | Based on their Usage and value |
| C. | Based on Physical Volume |
| D. | All of the above |
| Answer» C. Based on Physical Volume | |
| 192. |
If A = Annual Requirement, O = Order Cost and C = Carrying Cost per unit perannum, then EOQ |
| A. | (2AO/C) 2 |
| B. | 2AO/C |
| C. | 2A÷OC |
| D. | 2AOC |
| Answer» C. 2A÷OC | |
| 193. |
Which of the following is not included in cost of inventory? |
| A. | Purchase cost |
| B. | Transport in Cost, |
| C. | Import Duty, |
| D. | Selling Costs. |
| Answer» E. | |
| 194. |
Inventory is generally valued as lower of |
| A. | Market Price and Replacement Cost |
| B. | Cost and Net Realizable Value |
| C. | Cost and Sales Value |
| D. | Sales Value and Profit. |
| Answer» C. Cost and Sales Value | |
| 195. |
Cost of not carrying sufficient inventory is known as |
| A. | Carrying Cost |
| B. | Holding Cost |
| C. | Total Cost |
| D. | Stock-out Cost |
| Answer» E. | |
| 196. |
Which of the following is not a benefit of carrying inventories |
| A. | Reduction in ordering cost, |
| B. | Avoiding lost sales, |
| C. | Reducing carrying cost, |
| D. | Avoiding Production Shortages. |
| Answer» D. Avoiding Production Shortages. | |
| 197. |
Which of the following is not a standard method of inventory valuation? |
| A. | First in First out |
| B. | Standard Cost |
| C. | Average Pricing |
| D. | Realizable Value |
| Answer» D. Realizable Value | |
| 198. |
System of procuring goods when required, is known as, |
| A. | Free on Board (FOB) (b)always Butter Control |
| B. | , |
| C. | Jest in Time (JIT) |
| D. | Economic Order Quantity. |
| Answer» D. Economic Order Quantity. | |
| 199. |
A firm has inventory turnover of 6 and cost of goods sold is 7,50,000. With betterinventory management, the inventory turnover is increased to 10. This would result in: |
| A. | Increase in inventory by 50,000, |
| B. | Decrease in inventory by . 50,000, |
| C. | Decrease in cost of goods sold, |
| D. | Increase in cost of goods sold. |
| Answer» C. Decrease in cost of goods sold, | |
| 200. |
What is Economic Order Quantity? |
| A. | Cost of an Order |
| B. | Cost of Stock |
| C. | Reorder level |
| D. | Optimum order size. |
| Answer» E. | |