A company’s working capital essentially consists of current assets and current liabilities. Exports and Imports come under the purview of : Ministry of Finance. 2. Ministry of Home Affairs. Net Profit Ratio Signifies: (a) Operational Profitability, (b) Liquidity Position, (c) Big-term Solvency, (d) Profit for Lenders. The accounting convention that management must present an image of solvency and liquidity to the outside world by maintaining an excess of current assets over current liabilities is seriously questioned. This topic, mostly ignored by academics for years, is now gaining importance as we realize that financial markets are not as efficient as they were assumed to be, especially as firms expand outside the developed economies. In other words, the goal of working capital management is to ensure that a firm is able to continue its operations and that it has sufficient ability to satisfy both maturing short-term debt and upcoming operational expenses. Save Save MCQ Working Capital Management CPAR 1 84 For Later. If the company pays off the debts on time while generating revenues, then it ensures that the operating cycle of the company is properly funded, which will likely to boost the credit score of the company. What is working capital management? The focal point is the analytical approach to management of working capital. 5. Permanent working capital financed with long-term liabilities. Professionals, Teachers, Students and Kids Trivia Quizzes to test your knowledge on the … John … WORKING CAPITAL MANAGEMENT Page 9 1. B. COM SEMESTER 5- MCQ FINANCIAL MANAGEMENT 1. 5. Financial Management MCQ Questions and answers with easy and logical explanations. Working Capital is the money used to make goods and attract sales. Ministry of SSI. The primary goal of the financial management is ____________. Watch Now. Liquidity and risk b. 20% 20% found this document not useful, Mark this document as not useful. The cost structure for the company’s product, for the above mentioned activity level is detailed below. At the time of payment, only a small amount of working capital is enough. Short-term assets financed with equity. Reveal … Making greater use of short term finance and minimizing net short term asset. Current assets refer to those assets that can be converted into cash within one year, like debtors, and stock and prepaid expenses- expenses that have already been paid for. Which one of the following is not a cause but a consequence of Globalisation? Ended on Sep 16, 2020. Share. Removing question excerpt is a premium feature. The management of G Ltd has called for a statement showing the working capital needed to finance a level of 3,00,000 units of output for the year. Site Navigation; Navigation for Chapter 16: Working capital management "Shareholder wealth" in a firm is represented by: a) the number of people employed in the firm. Temporary current assets should be financed with temporary working capital. The working capital financing policy that subjects the firm to the greatest risk of being unable to meet the firm�s maturing obligations is the policy... Fluctuating current assets with long-term debt. Carousel Previous Carousel Next. Working Capital Management Objectives: The course will enable the student to manage activities in the area of working capital in an enterprise and help the students to do advance study in the field of financial-management through detailed analysis of financial statements, liquidity crises, cash optimization, credit analysis etc. Ebook Strategic Management ₹160.00 ₹106.40. _____ is the length of time between the firm’s actual cash expenditure and its own cash receipt. Questions for freshers and experienced for bank interview, competitive exams, placement interview, finance interview, manager interview, university … Net Profit Ratio Signifies: ... Profit for Lenders. AQ076-3-2-MF Working Capital Management Compensating Balance Many banks require a borrower to hold 10% to 20% of the outstanding loan balance on deposit in the borrower’s account (minimum balance in the bank throughout the loan period) This required amount is known as compensating balance is generally calculated as a percentage of the borrower’s loan’s outstanding. CA Ankit Bajaj. Once you have completed the test, click on 'Submit Answers for Grading' to get your results. Answer: Option A Solution (By Examveda Team) Working capital management is managing short term assets and liabilities. 80% 80% found this document useful, Mark this document as useful. Objective Questions and … The current ratio includes physical capital and the quick ratio does not. Ended on Sep 16, 2020. [A] stock velocity ratio [B] debtors velocity ratio [C] creditors velocity ratio [D] working capital turnover ratio; Answer: Option [A] 26. End of Question 8 Question 9. One of the major aspects of an effective working capital management is to have regular analysis of the company’s currents assets … Working Capital Turnover measures the relationship of Working Capital with: (a) Fixed Assets, (b) Sales, (c) Purchases, (d) Stock. Also explore over 113 similar quizzes in this category. - This Capital Management multiple choice question with answer is important for competitive exams. Working capital can be categorized on basis of Concept (gross working capital and net working capital) and basis of time (Permanent/ fixed WC and temporary/variable WC). Embed. In his traditional role the finance manager is responsible for ___________. No Frames Version Chapter 16: Working capital management. A. The session will be conducted in Hindi and note will be provided in English. FM Chapter 4 Questions – Management of working capital (2) – Inventory. Accounting Ratios are important tools used by (a) Managers, (b) Researchers, (c) Investors, (d) All of the above 2. Another remarkable difference is the extent or proportion of … Working Capital Management (WCM) refers to all the strategies adopted by the company to manage the relationship between its short term assets and short term liabilities with the objective to ensure that it continues with its operations and meet its debt obligations when they fall due. Buy this Ebook 29% Off. "Working capital is also known as", management of working capital Multiple Choice Questions (MCQs) with choices work in progress capital, current capital or circulating capital, day-to-day capital, and trading capital for master's degree in business administration. Hi, If compared the response in Question 2 with example 1 done by you in Chapter 1, I understand vice-versa. Temporary working capital b) Net working capital c) Gross working capital d) Permanent working capital 15. Integration of … Hindi CA Final Group 2. Which ratio is calculated to ascertain the efficiency of inventory management in terms of capital investment? Commerce provides you all type of quantitative and competitive aptitude mcq questions with easy and logical explanations. All assets financed with a 50 percent equity, 50 percent long-term debt mixture. Similar Classes. Working capital management questions and answers on topics like types & primary objective of working capital management, working capital cycle, factors affect working capital requirement, investment & signinficance of working capital. Page-7 section-1 This is particularly important from the point of view of financing. Working capital management is one of the most important topics in corporate finance: it relates to the operating investment of a firm and the way managers choose to finance it. Current Assets. Financial Management MCQ is important for exams like CA, CS, CMA, CPA, CFA, UPSC, NET, Banking and other accounts department exam. … Equity and debt c. Profitability and liquidity d. Long term and short term borrowing. Ebook Research Methodology ₹225.00 ₹160.31. Working Capital management is about the commercial and financial aspects of Inventory, credit, purchasing, marketing, and royalty and investment policy. This involves a need for working capital analysis. 4. To put it in other words, it is applying general management standards to the financial resources of the firm. 2. a trade-off between profitability and risk. S. No. Print. ... ABC Ltd has an effective mechanism for … Watch Now. Efficient … In this Session, CA Ankit Bajaj will do the Quick Revision of Working Capital Management and MCQ 1, this session will be beneficial for CA Intermediate Students. ... Next working day. The less Working Capital used to attract sales, the higher is likely to be the return on investment. A. The current ratio includes inventories and the quick ratio does not. MCQs Of Working Capital Management For MBA by Mr. Manish Agarwal Tags: MCQs Of Working Capital Management For MBA by Mr. Manish Agarwal MBA MBA Dr. A.P.J. "Shareholder wealth" in a firm is represented by: a) the number of people employed in the firm. Which of the following statements concerning working capital management are correct? 2. MULTIPLE CHOICE QUESTIONS . About 200 Examples and Graded Illustrations … What is working capital management? Try Working Capital Management Test with MCQ on debt equity ratio, Conservative working capital policy and Aggressive working capital policy Now! Current assets refer to those assets that can be converted into cash within one year, like debtors, and stock and prepaid expenses- expenses that have already been paid for. In this Session, CA Ankit Bajaj will do the Quick Revision of Working Capital Management and MCQ 5, this session will be beneficial for CA Intermediate Students. Managing working capital means finding a balance between… a. 1 and 3 only C. 2 and 3 only D. 1, 2 and 3. In other words, it refers to all aspects of administration of current assets and current liabilities. In this Session, CA Ankit Bajaj will do the Quick Revision of Working Capital Management and MCQ 1, this session will be beneficial for CA Intermediate Students. Similar Classes. Rajat Jain. WORKING CAPITAL MANAGEMENT Page 8 words, it represents the current assets required on a continuing basis over the entire year. MCQ on Financial Management 1. B. COM SEMESTER 5- MCQ FINANCIAL MANAGEMENT 1. Treasury management c. Merchant banking d. 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