Sunday, August 23, 2009

Virtual Uni ACC501 MCQs

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The process of planning and managing a firm’s long-term investments is called :

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Planning Process

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Capital Structure

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Capital Budgeting

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Managing Process

Question No: 2 ( Marks: 1 ) - Please choose one

Return on Equity (ROE) = _________ x Total Assets Turnover x Equity Multiplier

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Profit Margin

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Total Sales

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Net Income

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Total Equity

Question No: 3 ( Marks: 1 ) - Please choose one

If a bank loans out Rs. 10,000 for 90 days at 8% simple interest, the Present Value (PV) will be :

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Rs. 9,105

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Rs. 9,807

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Rs. 10,325

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Rs. 10,765

Question No: 4 ( Marks: 1 ) - Please choose one

The ____________ is the rate where NPV (Net Present Value) equals to zero.

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WACC (Weighted Average Cost of Capital)

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IRR (Internal Rate of Return)

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MIRR (Modified Internal Rate of Return)

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AAR (Average Accounting Return)

Question No: 5 ( Marks: 1 ) - Please choose one

______________ is adopted to permit minority participation.

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Cumulative Voting

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Straight Voting

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Proxy Voting

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Staggering

Question No: 6 ( Marks: 1 ) - Please choose one

Which one of the following statements projects future years’ operations in a summarized format ?

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Income Statement

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Cash Flow Statement

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Pro Forma Financial Statement

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None of the given options

Question No: 7 ( Marks: 1 ) - Please choose one

The direct and indirect costs associated with going bankrupt or experiencing financial distress, are known as :

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Direct Bankruptcy Costs

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Indirect Bankruptcy Costs

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Financial Distress Costs

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All of the given options

Question No: 8 ( Marks: 1 ) - Please choose one

Suppose you bought 1,500 shares of a corporation at Rs. 25 each. After a year, you received Rs. 3,000 (Rs. 2 per share) in dividends. The dividend yield will be :

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5.00 %

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8.00%

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10.00%

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12.00%

Question No: 9 ( Marks: 1 ) - Please choose one

You earn a 7% real return. If the inflation rate is 5 percent, what is your nominal return ?

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8.96 %

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9.05 %

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11.65 %

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12.35%

Question No: 10 ( Marks: 1 ) - Please choose one

The projected cash flows from a project are :

Years

Cash flows

1

Rs. 100

2

Rs. 300

3

Rs. 600

4

Rs. 800

The project costs Rs. 1,000. What would be the payback period for the project ?

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2.00 Years

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2.67 Years

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3.00 Years

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3.67 Years

Question No: 11 ( Marks: 1 ) - Please choose one

Sole Proprietorship is a business created as a distinct legal entity owned by one or more individuals or entities.

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True

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False

Question No: 12 ( Marks: 1 ) - Please choose one

The term discounting is associated with Future Value concept whereas the term compounding is associated with Present Value concept.

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True

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False

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