11-24-2010, 03:22 PM
Question # 1 of 15 ( Start time: 05:10:33 AM ) Total Marks: 1
Which of the following is not the present value of the bond?
Select correct option:
Intrinsic value
Market price
Fair price
Theoretical price
Question # 2 of 15 ( Start time: 05:11:50 AM ) Total Marks: 1
Which of the following is similar between Return on investment and Payback period techniques of Capital budgeting?
Select correct option:
Involvement of interest rate while making calculations
Do not account for time value of money
Tricky and complicated methods
All of the given options
Question # 3 of 15 ( Start time: 05:12:12 AM ) Total Marks: 1
Which of the following equation is NOT correct?
Select correct option:
Gross Revenue – Admin & Operating Expenses = Operating Revenue
Other Expenses + Other Revenue = EBIT
EBIT – Financial Charges & Interest = EBT
Net Income – Dividends = Retained Earning
Question # 4 of 15 ( Start time: 05:12:31 AM ) Total Marks: 1
Which of the following is NOT a cash outflow for the firm?
Select correct option:
Depreciation
Dividends
Interest
Taxes
Question # 5 of 15 ( Start time: 05:13:01 AM ) Total Marks: 1
Who or what is a person or institution designated by a bond issuer as the official representative of the bondholders?
Select correct option:
Indenture
Debenture
Bond
Bond trustee
Question # 6 of 15 ( Start time: 05:13:16 AM ) Total Marks: 1
MIRR (discount rate) equates which of the following?
Select correct option:
Future value of cash inflows to the present value of cash outflows
Future value of cash flows to the present value of cash flows
Future value of all cash flows to zero
Present value of all cash flows to zero
Question # 7 of 15 ( Start time: 05:13:31 AM ) Total Marks: 1
At the termination of project, which of the following needs to be considered relating to project assets?
Select correct option:
Salvage value
Book value
Intrinsic value
Fair value
Question # 8 of 15 ( Start time: 05:14:40 AM ) Total Marks: 1
Effective interest rate is different from nominal rate of interest because:
Select correct option:
Nominal interest rate ignores compounding
Nominal interest rate includes frequency of compounding
Periodic interest rate ignores the effect of inflation
All of the given options
Question # 9 of 15 ( Start time: 05:14:55 AM ) Total Marks: 1
For Company A, plow back ratio is 30%. What will be its Pay-out ratio?
Select correct option:
3.33%
30%
31%
70%
Question # 10 of 15 ( Start time: 05:15:13 AM ) Total Marks: 1
Which of the following needs to be excluded while we calculate the incremental cash flows?
Select correct option:
Depreciation
Sunk cost
Opportunity cost
Non-cash item
Question # 11 of 15 ( Start time: 05:15:27 AM ) Total Marks: 1
What is potentially the biggest advantage of a small partnership over a sole proprietorship?
Select correct option:
Unlimited liability
Single tax filing
Difficult ownership resale
Raising capital
Question # 12 of 15 ( Start time: 05:16:01 AM ) Total Marks: 1
Which of the following statements is TRUE regarding Permanent Accounts?
Select correct option:
Accounts that are found on Income Statement
Accounts that are found on Statement of Retained Earnings
Accounts that are found on Balance Sheet
All of the given options
Question # 13 of 15 ( Start time: 05:16:26 AM ) Total Marks: 1
What is the present value of Rs.8,000 to be paid at the end of three years if interest rate is 11%?
Select correct option:
Rs.6,015
Rs.4,872
Rs.6,725
Rs.1,842
Question # 14 of 15 ( Start time: 05:16:42 AM ) Total Marks: 1
What is the most important criteria in capital budgeting?
Select correct option:
Return on investment
Profitability index
Net present value
Pay back period
Question # 15 of 15 ( Start time: 05:16:57 AM ) Total Marks: 1
Where there is single period capital rationing, what is the most sensible way of making investment decisions?
Select correct option:
Choose all projects with a positive NPV
Group projects together to allocate the funds available and select the group of projects with the highest NPV
Choose the project with the highest NPV
Calculate IRR and select the projects with the highest IRRs
Which of the following is not the present value of the bond?
Select correct option:
Intrinsic value
Market price
Fair price
Theoretical price
Question # 2 of 15 ( Start time: 05:11:50 AM ) Total Marks: 1
Which of the following is similar between Return on investment and Payback period techniques of Capital budgeting?
Select correct option:
Involvement of interest rate while making calculations
Do not account for time value of money
Tricky and complicated methods
All of the given options
Question # 3 of 15 ( Start time: 05:12:12 AM ) Total Marks: 1
Which of the following equation is NOT correct?
Select correct option:
Gross Revenue – Admin & Operating Expenses = Operating Revenue
Other Expenses + Other Revenue = EBIT
EBIT – Financial Charges & Interest = EBT
Net Income – Dividends = Retained Earning
Question # 4 of 15 ( Start time: 05:12:31 AM ) Total Marks: 1
Which of the following is NOT a cash outflow for the firm?
Select correct option:
Depreciation
Dividends
Interest
Taxes
Question # 5 of 15 ( Start time: 05:13:01 AM ) Total Marks: 1
Who or what is a person or institution designated by a bond issuer as the official representative of the bondholders?
Select correct option:
Indenture
Debenture
Bond
Bond trustee
Question # 6 of 15 ( Start time: 05:13:16 AM ) Total Marks: 1
MIRR (discount rate) equates which of the following?
Select correct option:
Future value of cash inflows to the present value of cash outflows
Future value of cash flows to the present value of cash flows
Future value of all cash flows to zero
Present value of all cash flows to zero
Question # 7 of 15 ( Start time: 05:13:31 AM ) Total Marks: 1
At the termination of project, which of the following needs to be considered relating to project assets?
Select correct option:
Salvage value
Book value
Intrinsic value
Fair value
Question # 8 of 15 ( Start time: 05:14:40 AM ) Total Marks: 1
Effective interest rate is different from nominal rate of interest because:
Select correct option:
Nominal interest rate ignores compounding
Nominal interest rate includes frequency of compounding
Periodic interest rate ignores the effect of inflation
All of the given options
Question # 9 of 15 ( Start time: 05:14:55 AM ) Total Marks: 1
For Company A, plow back ratio is 30%. What will be its Pay-out ratio?
Select correct option:
3.33%
30%
31%
70%
Question # 10 of 15 ( Start time: 05:15:13 AM ) Total Marks: 1
Which of the following needs to be excluded while we calculate the incremental cash flows?
Select correct option:
Depreciation
Sunk cost
Opportunity cost
Non-cash item
Question # 11 of 15 ( Start time: 05:15:27 AM ) Total Marks: 1
What is potentially the biggest advantage of a small partnership over a sole proprietorship?
Select correct option:
Unlimited liability
Single tax filing
Difficult ownership resale
Raising capital
Question # 12 of 15 ( Start time: 05:16:01 AM ) Total Marks: 1
Which of the following statements is TRUE regarding Permanent Accounts?
Select correct option:
Accounts that are found on Income Statement
Accounts that are found on Statement of Retained Earnings
Accounts that are found on Balance Sheet
All of the given options
Question # 13 of 15 ( Start time: 05:16:26 AM ) Total Marks: 1
What is the present value of Rs.8,000 to be paid at the end of three years if interest rate is 11%?
Select correct option:
Rs.6,015
Rs.4,872
Rs.6,725
Rs.1,842
Question # 14 of 15 ( Start time: 05:16:42 AM ) Total Marks: 1
What is the most important criteria in capital budgeting?
Select correct option:
Return on investment
Profitability index
Net present value
Pay back period
Question # 15 of 15 ( Start time: 05:16:57 AM ) Total Marks: 1
Where there is single period capital rationing, what is the most sensible way of making investment decisions?
Select correct option:
Choose all projects with a positive NPV
Group projects together to allocate the funds available and select the group of projects with the highest NPV
Choose the project with the highest NPV
Calculate IRR and select the projects with the highest IRRs