CUET Business Studies Business Studies > Business Finance PYQs

Identify the correct sequence of the process of financial planning from the options given below: (A) The preparation of a sales forecast. (B) Estimates showing expected profits are made to know how much fund requirements can be met internally. (C) The preparation of financial statements. (D) Estimation of the requirement for external funds. Choose the correct answer from the options given below:

Which of the following is not a factor affecting the working capital requirements of a business firm?

Match List-I with List-II | List-I | List-II | | --- | --- | | Concept | Equation | | (A) Financial Leverage | (I) (Profit after tax+depreciation+interest+non cash expenses)/<br>(pref dividend+interest+repayment obligation) | | (B) Net Working Capital | (II) Debt/Equity | | (C) Interest Coverage Ratio | (III) Current Assets - Current Liabilities | | (D) Debt service coverage ratio | (IV) EBIT/Interest | Choose the correct answer from the options given below:

_________ is essentially the preparation of a financial blueprint of an organisation's future operations and it ensures that enough funds are available at right time.

The cost of raising funds from the market is known as:

Identify the correct statements in the context of financial planning. (A) The objective of financial planning is to ensure that enough funds are available at the right time. (B) Financial planning sees that firms do not raise funds unnecessarily from the market. (C) Proper matching of funds requirements and their availability is sought to be achieved by financial planning. (D) Financial planning includes both short-term and long-term planning. Choose the correct answer from the options given below:

Which of the following factors affects capital budgeting decisions? (A) Cash flows of the project (B) The investment criteria involved (C) Stock market sentiments (D) Level of competition Choose the correct answer from the options given below:

The decision about the investment in new machinery is called_______.

Match List-I with List-II | List-I | List-II | | --- | --- | | Concept | Description | | (A) Capital Structure | (I) Long Term Investment. | | (B) Capital Budgeting | (II) Profit distributed to shareholders. | | (C) Working Capital | (III) Financing Mix of business. | | (D) Dividend | (IV) Money required for short-term needs. | Choose the correct answer from the options given below:

Buying of new machinery is a decision relating to:

Higher Debt-Equity Ratio results in ______

The CFO of a company decides to maintain the capital structure as 1/2. The finance raised from owners and shareholders is Rs. 300 crore. How much debt financing does he need?

The primary aim of financial management is:

Identify the incorrect statement, from the options given below:

The number of times earnings before interest and taxes of a company covers the interest obligation is indicated by which ratio?

DSCR stands for:

Identify the asset which can be easily converted into cash.

Which among the following is NOT the current asset?

Which among the following refers to the increase in profit earned by the equity shareholders due to the presence of fixed financial charges?

Which among the following aims at smooth operations by focusing on fund requirements and their availability in the light of financial decisions?

The formula to compute the Interest Coverage ratio is:

Which concept of financial management affects both the profitability and the financial risk?

Match List-I with List-II | List-I | List-II | | --- | --- | | Concept | Meaning | | (A) Working Capital | (I) It refers to the mix between owners and borrowed funds for the sources of business finance. | | (B) Financial Management | (II) It is essentially preparation of a financial blueprint for an organization's future operations. | | (C) Capital Structure | (III) This investment facilitates smooth day-to-day operations of the organization. | | (D) Financial Planning | (IV) It is concerned with optimal procurement as well as usage of finance. | Choose the correct answer from the options given below:

What is the full form of EBIT?

Arrange the following steps involved in the process of financial planning in logical sequence. (A) Sales forecast is made (B) Requirement of fixed capital and working capital is estimated (C) Expected profits are estimated (D) Sources of finance are identified Choose the correct answer from the options given below:

Financial leverage is believed to be favorable if:<br><br>1. ROI is lower than cost of debt<br>2. ROI is higher than cost of debt<br>3. Debt is not easily available<br>4. If the interest rate is high

Money required for carrying out business activity is called:

Match List-I with List-II | List-I | List-II | | --- | --- | | (A) Net Working Capital | (I) Investments in long term assets. | | (B) Fixed capital decision | (II) Proportion of debt in the overall capital. | | (C) Financial Leverage | (III) Excess of current assets over current liabilities | | (D) Trading on equity | (IV) Increase in profit earned by the equity shareholders due to the presence of fixed financial charges. | Choose the correct answer from the options given below:

Current assets are usually more liquid but contribute less to the profits than fixed assets. Examples of current assets are: (A) Cash in hand/Cash at the Bank (B) Marketable securities (C) Bills receivable (D) Finished goods inventory Choose the correct answer from the options given below:

There are two projects, A and B (with the same risk involved), with a rate of return of 10 percent and X percent, respectively, if under normal circumstances, project B is selected. What could be the rate of return of Project B?

The objective of financial management is to maximize the current price of equity shares of the company. This concept is:

Making an investment in long term asset is related to:

Which of the following capital is required for funding the day-to-day operations of the business?

The mix between debt and owners fund is known as:

Which of the following are the objectives of Financial Planning? (A) To ensure availability of funds whenever required. (B) To see that the firm does not raise funds unnecessarily. (C) Helps to cope with business shocks. (D) Helps in minimizing cost of production. Choose the correct answer from the options given below:

Other things remaining the same, an increase in the tax rate on corporate profits will:

Capital structure refers to the mix of own and borrowed funds. The factors affecting the choice of capital structure are: (A) Business Cycle (B) Cost of debt (C) Return on Investment (D) Cost of Equity Choose the correct answer from the options given below:

The impact of financial leverage on the profitability of a business can be seen through:

Which of the following is not a decision in financial management?

Which of the following statements are correct? (A) Deciding about the capital structure of a firm involves determining the relative proportion of various types of funds. (B) Capital structure decision is essentially affected by the regulatory framework provided by the law. (C) Capital structure depends on factors like cash flow position, Return on Investment, Cost of debt & Equity etc. (D) Capital structure refers to the mix between reserves and borrowed funds. Choose the correct answer from the options given below:

Match List-I with List-II | List-I | List-II | | --- | --- | | (A) EBIT-EPS | (I) Credit availed | | (B) Fixed capital decision | (II) Financial leverage | | (C) Working capital Decision | (III) Capital Structure | | (D) Cost of equity and debt | (IV) Financing alternatives | Choose the correct answer from the options given below:

Which financial decision relates to committing the company's finances on a long term basis to different assets?

The factors affecting choice of capital structure are: <ol type="A"> <li>Cash flow position</li> <li>Tax Rate</li> <li>Nature of Business</li> <li>Cost of debt</li> </ol> Choose the correct answer from the options given below:

Match List-I with List-II | List-I | List-II | | --- | --- | | (A) Mix between owners fund and borrowed fund | (I) Financial risk | | (B) Inability of business to meet its obligation of payment of interest | (II) Capital structure | | (C) Proportion of debt and equity in overall capital | (III) Capital budgeting decision | | (D) Decisions that affect the amount of assets, competitiveness and profitability of business | (IV) Financial leverage | Choose the correct answer from the options given below:

__________ ensures availability of finance whenever needed.

Factors affecting the working capital requirement are: (A) Nature of Business (B) Seasonal factors (C) Credit availed (D) Stock market conditions Choose the correct answer from the options given below:

Name the Financial Decision which determines the capital structure of the company.

The factors affecting capital structure decisions are: (A) Fiscal policy (B) Stock market conditions (C) Control (D) Risk considerations Choose the correct answer from the options given below:

A firm is facing difficulties managing the expenses of day-to-day operations. Which decision has the company ignored here?

There is an increase in profit earned by equity shareholders because of the presence of fixed financial charges. This concept is:

The primary aim of financial management is:

The optimal combination of various sources of funds for a business is called:

The CFO of a company wants to change the capital structure of the company. Identify the factors which affect the choice of capital structure. (A) Stock Market Condition (B) Tax Rate (C) Cost of Equity (D) Level of Competition Choose the correct answer from the options given below:

Financial leverage is associated with which of the following? (A) $\frac{\text{Debt}}{\text{Debt + Capital}}$ (B) $\frac{\text{Debt}}{\text{Equity}}$ (C) $\frac{\text{Equity}}{\text{Debt + Capital}}$ (D) $\frac{\text{Debt}}{\text{Debt + Equity}}$ Choose the correct answer from the options given below:

Which of the following is a long-term source of finance?

Match List-I with List-II | List-I | List-II | | --- | --- | | Decision | Activity | | --- | --- | | (A) Long-term Investment Decision | (I) Choice of Technique | | (B) Working Capital Decision | (II) Cash Management | | (C) Fixed Capital Decision | (III) Raising capital by issuing shares/debentures | | (D) Financing Decision | (IV) Capital Budgeting | Choose the correct answer from the options given below:

Which of the following is an important factor to be considered in long-term investment decisions?

Which of the following is NOT a factor affecting working capital requirements?

Money required for carrying out the business activities is known as:

Arrange the following current assets, in order of liquidity. (A) Cash in hand (B) Bills receivable (C) Marketable securities (D) Finished goods inventory Choose the correct answer from the options given below:

The Debt Service Coverage Ratio of company A is higher than that of company B. What does this indicate?

Match List-I with List-II | List-I | List-II | | --- | --- | | Decisions | Factors affecting the Decisions | | --- | --- | | (A) Fixed Capital Decision. | (I) Diversification | | (B) Capital Structure Decision | (II) Cash flows of the project | | (C) Working Capital Decision | (III) Control on Business | | (D) Capital budgeting decision | (IV) Business Cycle | Choose the <b>correct</b> answer from the options given below:

What is the full form of EBIT?

Which of the following cannot be termed as owners' funds?

Financial management aims at choosing the best investment and financing alternatives by focusing on their costs and benefits. Its objective is to:

A proper matching of funds requirements and their availability is sought to be achieved by _______.

Debt is _______ but is more _______ for a business, the payment of interest and the return of principal is obligatory for the business.

Match List I with List II | LIST I | | LIST II | |---|---|---| | A. District Commission | I. | One crore to Ten crore rupees | | B. State Commission | II. | Appeal against National Commission in matter of its original jurisdiction. | | C. National Commission | III. | Upto one crore rupees | | D. Supreme Court | IV. | Exceeds Ten crore rupees | Choose the correct answer from the options given below:

Match List I with List II | LIST I | | LIST II | |---|---|---| | A. Regulatory Function of SEBI | I. | Levying fee or other charges | | B. Development Function of SEBI | II. | Training of intermediaries | | C. Protective Function of SEBI | III. | Controlling insider training | | D. Objective of SEBI | IV. | Regulate stock exchanges | Choose the correct answer from the options given below:

Which element of Marketing Mix refers to activities that make firm's product available to the target customers?

Identify the market that is known as Stock Exchange

As per Consumer Protection Act, 2019, State commission has a jurisdiction to entertain complaints where value of goods and services paid as consideration:-

Arrange the Channels of Distribution in order for a consumer product A. Consumer B. Retailer C. Wholesaler D. Producer Choose the correct answer from the option given below:

Identify for the following under whose overall administrative control, SEBI functions

Match List I with List II | LIST I | | LIST II | |---|---|---| | A. Convenience products | I. | Consumed in one or few uses | | B. Shopping products | II. | Brand loyality of the highest order | | C. Speciality products | III. | Purchased frequently | | D. Non durable products | IV. | Buyers devote considerable time | Choose the correct answer from the options given below:

Match List I with List II | LIST I | | LIST II | |---|---|---| | A. Treasury Bill | I. | Mobilise large amount of money | | B. Commercial paper | II. | Maturity period of one day to fifteen days | | C. Call money | III. | Maturity period of 15 days to one year | | D. Certificate of Deposit | IV. | Issued by RBI | Choose the correct answer from the options given below:

Which Marketing Management philosophy has main focus on existing product?

The primary aim of financial management is :-

Identify the rights provided to consumers by the Consumer Protection Act 2019 A. Right to Safety B. Right to be Informed C. Right to choose D. Right to be heard E. Right to be assured Choose the correct answer from the options given below:

Select from following who is considered Risk taker

Arrange the steps of Trading and Settlement procedure in Securities A. Open a demat account B. Place an order with the broker C. Sign a broker-client agreement D. Broker match the share price available E. Broker issue a trade confirmation slip Choose the correct answer from the options given below:

Capital structure should emphasize on:-

Identify the trend in stock market when equity shares are more easily sold even at higher price

Identify the factor which does not affect the financing decision of an organisation :

Identify the pair which does not affect the choice of capital structure :

Match List - I with List - II. | List - I | List - II | |---|---| | (A) The mix between owners' and borrowed funds | (I) Financial Planning | | (B) Quantum of finance to be raised from various long term sources | (II) Investment Decisions | | (C) How the firm's funds are invested | (III) Capital Structure | | (D) Financial blue print of an organisation | (IV) Financing Decisions | Choose the correct answer from the options given below :

Identify the correct statements in the context of financial decision : (A) Financial decision includes investment decision, financing decision and dividend decision (B) Short term investment decision is also known as 'capital budgeting decision' (C) Short term investment decision is also known as 'Working capital decision' (D) Investment decision includes raising funds from equity or debt (E) Investment decision includes short term and long term investment decision Choose the correct answer from the options given below :

The cost in the process of raising fund through equity is known as _____.

A trading organisation comparatively needs _____ investment in fixed assets as compared to a manufacturing organisation

Rajat is planning the break up of his finance to know the amount of capital that he will utilize to purchase fixed assets and current assets. Identify the financial decision taken by Rajat

Debt normally does not cause _____.

Dividend decision is affected by many factors. Identify the factors affecting dividend decisions. (a) State of Capital market (b) Control Consideration (c) Shareholder's Preference (d) Taxation Policy (e) Floatation Cost Choose the most appropriate answer from the options given below :

Identify the factors which affect the dividend decision. A. Stock market Reaction B. Floatation Cost C. Legal Constraints D. Fixed operating cost E. Cost of equity

Match the following components with the given information | List I | List II | |---|---| | A. Capital structure | I. Speculator who expects the prices to go down | | B. Bear | II. Speculator expecting a rise in the prices | | C. Bull | III. Proportion of debt and equality in total Capital | | D. Shareholder's Wealth | IV. Maximisation of the market value of equity shares |

"A company has the policy of giving liberal credit to its customers in order to increase the sales." Identify the factor affecting working capital requirement in the above situation.

Given below are the examples of current Assets. Identify which of them is highly liquid?

Radha Ltd has invested Rs. 100,000 in the business. Out of which Rs. 70000 is equity and Rs. 30,000 is debt. Net Profit after tax is 24,000. Calculate ROI

Under which of the following situation, a company is likely to get the benefit of trading on equity?

Identify the financial concept which refers to the preparation of financial blueprint of an organisation's future operation.

Name the primary objective of Financial Management.

Match List I with List II | List I | List II | |---|---| | A. Investment decisions | I. Source of raising finance | | B. Financing decisions | II. Proportion of debt and equity | | C. Dividend decisions | III. Long term or short term assets | | D. Capital Structure | IV. Amount of money to be retained | Choose the correct answer from the options given below:

It refers to a position when a company is unable to meet its fixed financial charges namely interest payment, preference dividend and repayment obligations. Name the concept highlighted in the above lines:

From the following source of finance, identify the source that is not related to Owner's fund:

The primary aim of financial management is to maximise Shareholder's wealth through proper planning of finance and preparation of a financial blue print of an organisation's future operations. Identify the term being reflected here.

Ownership Capital is also known as:

Current assets are those assets which get converted into cash within

Ramanuj is thinking of starting an advertising agency. What will be the amount of working capital requirement for him?

During a bearish phase of stock market, company should make use of _____.

Computers become obsolete fast and are replaced much sooner than furniture. The requirement of fixed capital, hence, is more for the firms dealing in computers. Identify the factor affecting fixed capital from the above para.

'The decision determines the overall cost of capital and the financial risk of the enterprises.' Which decision is highlighted in the above statement?

Identify one statement among the following that is NOT true about capital budgeting:

A company will tend to pay lower rate of dividend if ___

It is a process of estimating the fund requirement of a business and specifying the sources of funds

A firm's ability to borrow at a lower rate

Arrange the following current assets in order of their liquidity A. Prepaid expenses B. Raw Material C. Debtors D. Finished goods inventory E. Bills receivable Choose the correct answer from the options given below: