Financial Management

581. A firm's working capital consists of investment in

  1. Current assets
  2. Current Liabilities
  3. Short term assets
  4. Both (a) and (c)
Correct answer: (D)
Both (a) and (c)

582. Financial management deals with two things -- raising money and:

  1. Operations management
  2. Production management
  3. Warehousing
  4. Managing a company's finances
Correct answer: (D)
Managing a company's finances

583. The most important item that can be extracted from financial statements is the actual ______________ of the firm.

  1. Net Working Capital
  2. Cash Flow
  3. Net Present Value
  4. None of the given options
Correct answer: (B)
Cash Flow

584. One of the limitations of the ______________ is that it is based on historical costs.

  1. Income statement
  2. Statement of cash flows
  3. Balance sheet
  4. none of the above
Correct answer: (C)
Balance sheet

585. Short - term interest rates, in a normal economy, are generally ______________ than long - term rates.

  1. Higher
  2. The same
  3. Lower
  4. None of the above
Correct answer: (C)
Lower

586. A firm's working capital consists of investment in

  1. Current Assets
  2. Current liabilities
  3. Short term assets
  4. Both a & c
Correct answer: (D)
Both a & c

587. An example of current liability

  1. Creditors
  2. Outstanding expenses
  3. Provisions for depreciation
  4. All
Correct answer: (D)
All

588. A series of activities in an organization related to production is known as

  1. Operating cycle
  2. Working cycle
  3. Current cycle
  4. Fixed cycle
Correct answer: (A)
Operating cycle

589. Long term sources are

  1. Retained earnings
  2. Debentures
  3. Share capital
  4. All of the above
Correct answer: (D)
All of the above

590. Finance function is one of the most important functions of ______________ management.

  1. business
  2. marketing
  3. financial
  4. debt
Correct answer: (C)
financial
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