
XII ISC 2 CAPITAL FIXED-WORKING 24-25
Quiz by Anita Sinha
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Business finance is needed to
Which of the following is not a tangible asset?
Financial management aims at
Primary aim of financial management is to
The decision relates to how the firm's funds are invested in different assets,
Purchasing a new machine to replace an existing one is an example of
These decision affect the liquidity as well as profitability of a business.
The decision is about the quantum of finance to be raised from various long-term sources.
The working capital requirement of a business is not likely to be high when?
Under which of the following circumstances the fixed capital requirement of a business is not likely to be high?
Which of the following statements is not true with regard to the use of fixed capital?
Under which of the following situations a company is not likely to issue equity capital?
When the debt service coverage ratio is high.
When the interest coverage ratio is high.
When the cost of debt capital is low.
All of the above
A higher financial leverage ratio indicates that _____.
Which of the following statements is not true?
Which of the following is not important in financial planning?
Which of the following is not an objective of financial planning?
The main goal of financial management is to-
Making an investment decision involves-
Which among the following is a factor that should be considered before making an investment decision-
Asset size, profitability, and competitiveness are all influenced by –
Which of the following statements is not true?
The ration between equity and debt is called
Trading on equity means
Revolving capital means
Block capital means
Net working capital
Capital required at the time of commencement of a business
Capital required to meet future contingencies
Which factor is not considered for determining the amount of working capital of a business enterprise:
Capital needed for coping up the situation like strikes, natural calamities etc:
The fixed capital is termed as Block Capital,because:
Amount of capital invested on inventory,debtors and marketable securities:
The Gross working capital of a business
Revolving capital isalso known as:
Which of the following best defines fixed capital?
Which of the following is an example of fixed capital?
Working capital is calculated as:
What is the purpose of working capital?
Which of the following is an example of working capital?
Which of the following is NOT a characteristic of fixed capital?
Which of the following statements is true about working capital?
Which of the following is a source of working capital?
Which of the following is a source of fixed capital?
Which of the following is an example of a fixed capital expenditure?
Assertion: Fixed capital is used for long-term investment purposes in a business.
Reason: Fixed capital includes assets like land, buildings, and machinery that are not easily converted into cash.
Assertion: Working capital is essential for the day-to-day operations of a business.
Reason: Working capital represents the funds available to cover short-term expenses and obligations.
Assertion (A): Trading on Equity raises the return of equity shareholders.
Reason (R): Cost of debt is lower than the cost of equity and interest paid on debt is a deductible expense.
Assertion (A): The primary objective of financial management is to maximise the wealth of equity shareholders.
Reason (R): Investment Decision is concerned with the investment of a firm’s funds in different assets.
Assertion (A): Higher the lead time, the lower is the amount of working capital requirement.
Reason (R): If the raw material is available freely and continuously, then less working capital is needed as less inventory has to be maintained.
Assertion (A): A transport service provider needs less working capital.
Reason (R): A service firm sells more on a cash basis and does not have to maintain inventory.
Assertion (A): More working capital is required in a highly competitive market.
Reason (R): Competition forces a firm to adopt strict credit terms.
Assertion (A): Collaboration of an organization with another organization reduces the need of fixed capital.
Reason (R): Availability of leasing facilities reduces the fixed capital requirement of a company.
Assertion: Working capital is calculated by subtracting current liabilities from current assets.
Reason: Current assets are the assets that are expected to be converted into cash or used up within one year.