FINANCE QUIZ

   The following account totals appear in the general ledger of the Boston Company:

Equipment = 1,50,000

Accumulated Depreciation = 45,000

If the equipment is sold to an outsider for 70,000, what amount of gain/loss will Boston

Company record on the disposal of the equipment?

• - 35,000

•   25,000

•   25,000

• - 10,000

Which of the following is not a profitability ratio?

• Inventory turnover

• earnings per share

• profit margin

• price to earnings

  Solvency refers to:

• The ability to sell inventory

• The ability to pay short-term obligations

• The ability to generate cash from receivables

• The ability to pay long-term obligations

Which of the following is not one of the three components in a DuPont analysis?

• Operating Efficiency

• Assests effectiveness

• Capital structure

• All of the above

PV has the following relationship with the interest rate

• Higher the interest rate, higher the PV

• Higher the interest rate ,Lower the PV

• Lower the interest rate , Lower the PV

• Both A and C

When a loan is taken, the total amount repaid with interest will be

• Higher when the period of the loan is long

• Lower when the period of the loan is long

• The same regardless of the period

• We need figures to get a correct answer

A company purchased equipment worth ₹10,000 on credit. How does this transaction affect the accounting equation?

• Increase assets and decreases liabilities

• Increase assets and increase liabilities

• Decrease assets and increases owners equity

• Has no effect on the accounting equation

After an equated monthly instalment (EMI) has been determined for a housing loan, the borrower pays a lump-sum amount in partial repayment. Now the EMI will

• Come down if the period of the loan remains the same

• Go up if the loan period is the same

• Be higher or lower depending on whether the loan is a fixed or floating rate loan

• Depend on the interest rate now prevailing in the market

Which of the following statements is right?

• Bond is safer than stock

• Generally, a bond gives higher returns than a stock

• A bond cannot be sold in the market

• Both A and C

The face value of a bond is

• The final amount paid on the bond

• The initial amount paid for the bond

• The amount on which the coupon is calculated

• Both A and C