Business-Finance MCQs

Commerce Objective Questions

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239. Participating preference shares are those participating in the

A. General meeting of the company

C. Right on assets when the company is liquidated

D. Management of the company

240. The appropriate ratio for indicating liquidity crisis is

A. Operating ratio

B. Sales turnover ratio

C. Current ratio

D. Acid test ratio

241. Capital budgeting is related to

A. Long-term assets

B. Short-term assets

C. Long-term and short-term assets

D. Fixed assets

242. Match the following.

List-I (Term)	List-II (Source)
a. Long-term	1. Factoring Bank
b. Medium-term	2. Debentures
c. Short-term	3. Lease financing

A. a-3, b-1, c-2

B. a-1, b-2, c-3

C. a-2, b-3, c-1

D. a-1, b-3, c-2

243. Assertion (a): When two or more investment proposals are mutually exclusive, ranking the proposals on the basis of IRR, NPV and PI methods may givecontradictory results.
Reason (R): The contradictory results in the ranking are due to differing dimensions relating to the scale of investments, cash flow patterns and project lives.
Indicate the correct answer:

A. Both (A) and (R) are true

B. (A) is true, but (R) is a necessary condition, but not a sufficient condition

C. Both (A) and (R) are false

D. Both (A) and (R) are true and (R) explains the reason sufficiently

244. In capital budgeting, the term 'capital rationing' implies

A. That no retained earnings are available

B. That limited funds are available for investment

C. That no external funds can be raised

D. That no fresh investment is required in current year

245. If the earnings of company are stable then it can easily follow

A. stable dividend policy

B. flexible dividend policy

C. lower rate dividend policy

D. None of these

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