Multiple Choice Questions (MCQ) on Financial Accounting
1- The law of demand is a
A:- Quantitative statement
B:- Qualitative statement
C:- Illustrative statement
D:- Selective statement
2- National Income is
A:- Net dividend
B:- Net output
C:- Net interest
D:- Net income
3- The income method for measuring GNP considers
A:- Wages and Salaries
B:- Unpublished corporate profits
C:- Rents
D:- All of the above
4- Which item is included in the capital structure of a company
A:- Equity capital
B:- Preference share capital
C:- Debt capital
D:- All of these
5- When is the capital redemption reserve account opened
A:- At the time of equity repayment
B:- At the time of preference share redemption
C:- At the time of starting a business
D:- At the time of expansion of a business
6- A company can reduce its issued capital by
A:- Convertible shares
B:- payment of loan
C:- Redemption of redeemable preference shares
D:- Payment of interest
7- The dividend is the portion of
A:- Current assets
B:- Debt
C:- Networth of the company
D:- Profit of the company
8- The method of raising equity capital from existing members by offering securities on a pro-rata basis is referred to as
A:- Public issue
B:- Bonus issue
C:- Right issue
D:- Bought-out deals
9- The CAPM model can be explained as a linear relationship between systematic risk and security returns. This relationship is termed as
A:- Security market line
B:- Security risk factor
C:- Risk probability line
D:- None of the above
10- Which of the following is not a diversifiable risk factor?
A:- Employee strike
B:- Death of Chairman
C:- Bankruptcy of primary vendor
D:- Economic recession
ANSWERS:
1-(B), 2-(B), 3-(D), 4-(D), 5-(B), 6-(C), 7-(D), 8-(C), 9-(A), 10-(D)