a) Debt funds are raised in the form of

i)
Debentures
ii)
Term loans
iii)
Bonds
iv)
All of the above
b) One of the following is not a commonly employed long term
finance in a company form of business:
i)
Debenture Capital
ii)
Preference capital
iii)
Retained earnings
iv)
Bank cash credit
c) The excess of current assets over current liabilities is called:
i)
Net working capital
ii)
Net current assets
iii)
Working capital
iv)
All of the above
d) The need of working capital arises because of time gap
between production of goods and their actual realization after
sales is termed:
i)
Operating cycle
ii)
Business cycle
iii)
Cash conversion cycle
iv)
None of the above
e) The firm attempts to increase its level of sales without having
a support of adequate working capital is a situation of:
i)
Under capitalization
ii)
Over capitalization
iii)
Over trading
iv)
Prolonged operating cycle
f) Find the value of the bond on an annual coupon bond

with face value of Rs 1000,coupon rate of 6.5% and 30

years remaining until maturity.
i)
925
ii)
985
iii)
1100
iv)
None of the above
g) Find the Yield to maturity of a semi-annual coupon bond
with a price of Rs 1092.face value of Rs 1000.coupon
rate of 6% and 7 years until maturity.
1) 0.5%
2) 0.66%
3) 1.2%
4) 0.044%
h) Find the yield to maturity on an annual coupon bond
with price of Rs.850.face value of Rs.1000, coupon rate
of 11% and 23 years remaining until maturity.
1)
2)
3)
4)

12%
12.8%
12.5%
13%

i) Find the value of the bond with par value Rs 1000,

coupon rate 10% and maturity period 5 years.

1) 1010
2) 1025
3) 989
4) None of the above
j) Find the yield to maturity on an annual coupon bond
with price of Rs.870 and face value of RS.1000 and
coupon rate of 12.75% and 24 years remaining until
maturity.
1) 14.2%
2) 15.2%
3) 13%
4) 14.5%
a) Promissory note is a type of
1) Commercial paper
2) Certificate of deposit
3) Negotiable instrument
4) None of the above
b) The networth which corporate should have for issuening
commercial paper is
1) 8 crores
2) 10 crores
3) 2 crores
4) 4 crores
c) An instrument issued by government to tide over short term
liquidity funds is
1) Certificate of deposit
2) Treasury bills
3) Bonds
4) Debentures
d) A firms investments in current assets is known as
1) Working capital
2) Net working capital

3) Gross working capital

4) Total working capital
e) Accounts receivable is a component of
1) Gross working capital
2) Net working capital
3) Current assets
4) Total assets
f) The following is not a determinant of working capital
1) Manufacturing cycle
2) Business cycles
3) Production policy
4) Cash balance
d) Which of the following is highly liquid asset in the business
1) Debtors
2) Cash
3) Current Assets
4) None of the above

e) Cost incurred by stores department does not include

1) Carrying cost
2) Conveyance.
3) Ordering cost.
4) Purchase cost.

f) If current assets are Rs 250000 and current liabilities are Rs 160000 than working capital is
1) Rs 20000.
{ }
2) Rs 90000
3) Rs 25000.
4) Rs 91000.
g) X ltd is planning to manufacture 10000 units in the current year. If purchase cost is Rs 10,
ordering cost is Rs 3, Carrying cost is 20%, than EOQ is
{ }
1) 123 Units
2) 122 Units
3) 120 Units
4) 150 Units
h) Which of the following would be consistent with a more aggressive approach to financing
working capital?
{ }
1) Financing short-term needs with short-term funds
2) Financing permanent inventory buildup with long-term debt
3) Financing seasonal needs with short-term funds.
4) Financing some long-term needs with short-term funds.

i)

Gross Working Capital includes

1) Total Assets
2) Total Current Assets
3) Current Liabilities
4) All of the above

j)

Net working capital refers to

1) total assets minus fixed assets
2) current assets minus current liabilities
3) current assets minus inventories.
4) current assets.

a) Which of the following would be consistent with a more aggressive approach to

financing working capital?
5) Financing short-term needs with short-term funds
6) Financing permanent inventory buildup with long-term debt
7) Financing seasonal needs with short-term funds.
8) Financing some long-term needs with short-term funds.
b) Which asset-liability combination would most likely result in the firm's having the
greatest risk of technical insolvency?
5) Increasing current assets while lowering current liabilities
6) Increasing current assets while incurring more current liabilities
7) Reducing current assets, increasing current liabilities, and reducing long-term
debt.
8) Replacing short-term debt with equity
c) Net working capital refers to
5) total assets minus fixed assets
6) current assets minus current liabilities
7) current assets minus inventories.
8) current assets.
9) Factoring
10)

Bonus Issue

11)

Bonds Vs Debentures

12)

YTM

13)

YTC

14)

Markets can be classified into ______________ and ________________

15)
The short term borrowings that a corporate does from other
corporate is known as _______________________
16)
The loans whose maturity period varies from 1 to 15 days is known
as _____________________________
17)

SEBI replaced __________________________

18)

SEBI stands for__________________________________

19)
If equity shares are issued to existing share holders than it is known
as ___________________________
20)

___________________ cannot be made in lieu of dividend

21)
Money provided by investors to startup firms is known as
________________________
22)

Formulae for EOQ is ______________________

23)

P/E ratio stands for __________________________

Controller of capital issues was abolished in _____________

Value of a bond is _________________________
Value of an ordinary share is __________________
Debtors is a component of _____________________
________________ is the rate earned by an investor who
purchases a bond and holds it till its maturity.
29)
Risk financing can be termed as _______________
30)
A firm must have ______________ neither excess nor shortage
31)
When current assets exceed current liabilities the net working
capital is _____________
32)
_________is used to estimate working capital requirements of a
firm
33)
Management of cash balances can be done by
_________________ and ________________
24)
25)
26)
27)
28)

34)
35)
36)
37)
38)
39)
40)
41)

Define Bond?
Define working capital?
Equity share Vs Preference Share
Define Commercial Paper?
Define P/E Ratio?
Commercial paper
EOQ
Inter corporate deposits