Saturday, August 1, 2009

ACC501 Mcqs

ACC501 Mcqs
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Fee paid to the consultant for evaluating the option of launching a new product will be considered as:


Sunk Cost


Opportunity Cost


Financing Cost


Operating Cost

A risk that affects a single or at most a small number of assets is called:


Unsystematic Risk


Unique Risk


Diversifiable Risk


All of the given options

What will be the payback period of a Rs.70,000 investment with the following cash inflows?
Years Cash flows
1 Rs. 15,000
2 Rs. 20,000
3 Rs. 25,000
4 Rs. 15,000
5 Rs. 5,000

3.57 years


3.67 years


4.57 years


4.67 years

Which of the following is the required return on a firm's debt by its creditors?


Cost of Equity


Cost of Debt


Cost of Preferred Stock


Cost of Capital

Which one of the followings is the overall required return the firm must earn on its existing assets to maintain the value of the stock?


AAR (Average Accounting Return)


IRR (Internal Rate of Return)


MIRR (Modified Internal Rate of Return)


WACC (Weighted Average Cost of Capital)

The costs to store and finance the assets are known as:


Carrying Costs


Shortage Costs


Manufacturing Costs


None of the given options


The minimum level of inventory that a firm keeps on hand is called:


Common stock


Safety Stock


Preferred Stock


Dangerous Stock

Realization Principle is one of the basic principles of GAAP.


True


False

Whenever the word Dividend is used, it always refers to a long-term loan.


True


False


A preferred dividend is exactly like interest on bond.


True


False



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