Vocational English Online Olympiad
Mandakh University Sophomore Online Olympiad - Stage 1
Questions and Answers
- 1.
Operating margin minus taxes is gross margin.
- A.
True
- B.
False
Correct Answer
B. FalseExplanation
The given statement is false. Operating margin minus taxes is not equal to gross margin. Gross margin is calculated by subtracting the cost of goods sold from the revenue, while operating margin is calculated by subtracting operating expenses from the gross margin. Taxes are not included in the calculation of either gross margin or operating margin. Therefore, the statement is incorrect.Rate this question:
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- 2.
Cash flow statements only record cash.
- A.
True
- B.
False
Correct Answer
A. TrueExplanation
Cash flow statements only record cash because they focus on the movement of cash in and out of a company during a specific period. These statements track the cash generated from operating activities, such as sales and expenses, as well as cash from investing and financing activities. Non-cash items, such as depreciation or changes in non-cash working capital, are not included in the cash flow statement. Therefore, the statement is true as it accurately reflects the purpose and content of cash flow statements.Rate this question:
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- 3.
Dividends are not included in cash flow statements.
- A.
True
- B.
False
Correct Answer
B. FalseExplanation
Dividends are actually included in cash flow statements. The cash flow statement provides information about the cash generated and used by a company during a specific period, and dividends are considered as cash outflows. They are classified as a financing activity in the cash flow statement, as they involve the distribution of profits to shareholders. Therefore, the correct answer is False.Rate this question:
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- 4.
Cash and inventory are fixed assets.
- A.
True
- B.
False
Correct Answer
B. FalseExplanation
Cash is a current asset, not a fixed asset. Fixed assets are long-term assets that are not easily converted into cash, such as property, plant, and equipment. Inventory, on the other hand, is a current asset that represents the goods a company has on hand to sell. Therefore, the statement that cash and inventory are fixed assets is false.Rate this question:
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- 5.
Insufficient cash leads to unexpected expenditures.
- A.
True
- B.
False
Correct Answer
B. FalseExplanation
Insufficient cash does not lead to unexpected expenditures. In fact, it is the opposite. When there is a lack of cash, individuals are more likely to be cautious and careful with their spending, resulting in fewer unexpected expenditures.Rate this question:
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- 6.
There are many types of loans with varying terms.
- A.
True
- B.
False
Correct Answer
A. TrueExplanation
The statement is true because there are indeed many types of loans available in the market, each with its own set of terms and conditions. Loans can vary in terms of interest rates, repayment periods, collateral requirements, and eligibility criteria. Examples of different types of loans include personal loans, home loans, auto loans, student loans, and business loans. Therefore, it is accurate to say that there are many types of loans with varying terms.Rate this question:
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- 7.
A statement of financial condition shows debt.
- A.
True
- B.
False
Correct Answer
A. TrueExplanation
A statement of financial condition, also known as a balance sheet, provides a snapshot of a company's financial position at a specific point in time. It includes information about the company's assets, liabilities, and equity. Debt is a component of liabilities, so a statement of financial condition does indeed show debt. Therefore, the correct answer is true.Rate this question:
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- 8.
Restructuring involves reducing a workforce.
- A.
True
- B.
False
Correct Answer
A. TrueExplanation
Restructuring typically involves making changes to the organizational structure of a company, which often includes reducing the workforce. This can be done through layoffs, early retirements, or other means of reducing the number of employees. Therefore, the statement that restructuring involves reducing a workforce is true.Rate this question:
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- 9.
The interest on some loans can help lower taxes.
- A.
True
- B.
False
Correct Answer
A. TrueExplanation
Interest on certain types of loans, such as student loans or mortgages, can be tax-deductible. This means that the amount of interest paid on these loans can be subtracted from the individual's taxable income, resulting in a lower overall tax liability. This deduction can help reduce the tax burden for individuals who have these types of loans, making the statement "The interest on some loans can help lower taxes" true.Rate this question:
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- 10.
P and L statements show expenses from a period of time.
- A.
True
- B.
False
Correct Answer
A. TrueExplanation
The statement is true because P and L statements, also known as profit and loss statements, provide a summary of a company's revenues, costs, and expenses during a specific period of time, typically a fiscal quarter or year. These statements help in assessing the financial performance and profitability of a business by showing the expenses incurred over a given period.Rate this question:
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- 11.
Businesses use budgets to measure their progress.
- A.
True
- B.
False
Correct Answer
A. TrueExplanation
Budgets are an essential tool for businesses as they help in measuring and monitoring progress. By setting financial targets and allocating resources, budgets provide a framework for businesses to track their performance against goals. They enable businesses to evaluate their financial health, identify areas of improvement, and make informed decisions. Budgets also facilitate effective communication and coordination among different departments within an organization. Overall, budgets play a crucial role in assessing and managing the progress of businesses.Rate this question:
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- 12.
Balance sheet is not a document that shows a company's assets, liabilities and equity.
- A.
True
- B.
False
Correct Answer
B. FalseExplanation
The statement given in the question is incorrect. A balance sheet is indeed a document that shows a company's assets, liabilities, and equity. It provides a snapshot of the financial position of a company at a specific point in time, detailing what the company owns (assets), what it owes (liabilities), and the residual interest of the owners (equity). Therefore, the correct answer is False.Rate this question:
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- 13.
P and L is a cash flow statement.
- A.
True
- B.
False
Correct Answer
B. FalseExplanation
The given statement is false. P and L refers to the Profit and Loss statement, which is a financial statement that summarizes the revenues, costs, and expenses incurred during a specific period of time. It is not a cash flow statement, which is a financial statement that shows how changes in balance sheet accounts and income affect cash and cash equivalents. Therefore, the correct answer is false.Rate this question:
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- 14.
Outflow is cash moving into a company.
- A.
True
- B.
False
Correct Answer
B. FalseExplanation
The given statement is incorrect. Outflow refers to cash moving out of a company, not into it. Cash outflows include payments for expenses, investments, and loans, among others.Rate this question:
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- 15.
Equity is total value of stocks someone owns in a company.
- A.
True
- B.
False
Correct Answer
A. TrueExplanation
Equity refers to the total value of stocks that an individual owns in a company. It represents the ownership interest in the company and is calculated by subtracting liabilities from assets. Therefore, the statement "Equity is the total value of stocks someone owns in a company" is true.Rate this question:
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- 16.
Before you start your business, you must know how you will run it.
- A.
True
- B.
False
Correct Answer
A. TrueExplanation
It is important to have a clear understanding of how you will operate your business before starting it. This includes having a business plan, knowing your target market, understanding your competition, and having a strategy in place for marketing, sales, and operations. Without a plan in place, it becomes difficult to make informed decisions and effectively manage the business. Therefore, the statement "Before you start your business, you must know how you will run it" is true.Rate this question:
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- 17.
Current liabilities are debts that must be paid within 10 years.
- A.
True
- B.
False
Correct Answer
B. FalseExplanation
Current liabilities are debts that must be paid within one year or the operating cycle of a company, whichever is longer. This includes obligations such as accounts payable, short-term loans, and accrued expenses. Therefore, the statement that current liabilities must be paid within 10 years is incorrect.Rate this question:
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- 18.
The petty cash fund is reserved for small expenditures.
- A.
True
- B.
False
Correct Answer
A. TrueExplanation
The petty cash fund is a small amount of cash that is set aside for minor expenses or emergencies. It is typically used for small purchases such as office supplies, postage, or refreshments. By having a petty cash fund, organizations can avoid the hassle of writing checks or going through the formal process of reimbursement for these small expenses. Therefore, the statement that the petty cash fund is reserved for small expenditures is true.Rate this question:
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- 19.
Saving accounts don’t gain more interest over time.
- A.
True
- B.
False
Correct Answer
B. FalseExplanation
Saving accounts do gain more interest over time. This is because the interest earned on a savings account is usually calculated based on the account balance and the length of time the money has been in the account. As time passes, the account balance increases and so does the interest earned. Therefore, the statement that saving accounts don't gain more interest over time is false.Rate this question:
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- 20.
A master budget is really necessary for small businesses.
- A.
True
- B.
False
Correct Answer
B. FalseExplanation
A master budget is a comprehensive financial plan that includes all aspects of a business's operations, such as sales, expenses, and cash flow. While a master budget can be beneficial for larger businesses, it may not be necessary for small businesses due to their simpler operations and smaller scale. Small businesses may find it more practical to create simpler budgets or rely on more informal financial planning methods. Therefore, the statement that a master budget is really necessary for small businesses is false.Rate this question:
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- 21.
Some common financial documents include: contracts, bank statements, and legal tender.
- A.
True
- B.
False
Correct Answer
B. FalseExplanation
The given statement is false because contracts, bank statements, and legal tender are not considered financial documents. Contracts are legal agreements, bank statements are records of transactions, and legal tender refers to the official currency of a country. Financial documents typically include items such as financial statements, tax returns, invoices, and receipts.Rate this question:
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- 22.
Bottom out is to reach a highest point.
- A.
True
- B.
False
Correct Answer
B. FalseExplanation
The statement that "Bottom out is to reach a highest point" is false. To "bottom out" means to reach the lowest point or the bottom of something. It is the opposite of reaching a highest point.Rate this question:
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- 23.
Early payoff penalty is a penalty for paying off a loan after the term ends.
- A.
True
- B.
False
Correct Answer
B. FalseExplanation
The statement is false because an early payoff penalty is a penalty for paying off a loan before the term ends, not after. This penalty is often imposed by lenders to compensate for the potential loss of interest that would have been earned if the loan had been paid off according to the original schedule.Rate this question:
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- 24.
As sole proprietor, you make all decisions about the business.
- A.
True
- B.
False
Correct Answer
A. TrueExplanation
As the sole proprietor of a business, you have complete control and authority to make all decisions regarding the business. This means that you have the power to determine the direction, strategies, and operations of the business without any input or interference from others. Being the sole decision-maker allows for quick decision-making and flexibility in adapting to changing circumstances. However, it also means that you bear full responsibility for the success or failure of the business.Rate this question:
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- 25.
Investors in companies buy fractions of ownership called shares.
- A.
True
- B.
False
Correct Answer
A. TrueExplanation
Investors in companies buy fractions of ownership called shares. This statement is true because when investors purchase shares of a company, they are essentially buying a portion of the company's ownership. This entitles them to certain rights, such as voting rights and a share in the company's profits. By owning shares, investors become shareholders and have a stake in the company's success or failure.Rate this question:
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- 26.
To open an account at a bank, you have to fill out a(n) ___________.
- A.
Application
- B.
Statement
- C.
Record
Correct Answer
A. ApplicationExplanation
To open an account at a bank, you have to fill out an application. This is a common practice in banking institutions where individuals are required to provide personal information and details about the type of account they wish to open. The application serves as a formal request to the bank, allowing them to assess the individual's eligibility and suitability for the account. It also helps the bank gather necessary information for the account setup process. Therefore, filling out an application is an essential step in opening a bank account.Rate this question:
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- 27.
The ____________ fund is only for business related expenditures.
- A.
Change
- B.
Petty cash
- C.
Bill
Correct Answer
B. Petty cashExplanation
The term "petty cash" refers to a small amount of money set aside for minor business expenses. It is typically used for small purchases that do not warrant the use of a company's regular funds or the issuance of a check. The other options, "change" and "bill," do not specifically pertain to funds allocated for business expenses, making "petty cash" the correct answer.Rate this question:
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- 28.
Six hundred and seven hundred is thirteen __________.
- A.
Hundred
- B.
Thousand
- C.
Million
Correct Answer
A. HundredExplanation
The correct answer is "hundred" because when we add the numbers 600 and 700, the sum is 1300. In this context, "hundred" is used to express a quantity of 100.Rate this question:
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- 29.
To__________ is to change frequently.
- A.
Stabilize
- B.
Drop
- C.
Fluctuate
Correct Answer
C. FluctuateExplanation
The word "fluctuate" means to change frequently or vary in an irregular manner. This fits perfectly with the given statement that "To fluctuate is to change frequently." The other options, "stabilize" and "drop," do not convey the idea of changing frequently, so they are not the correct answer.Rate this question:
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- 30.
If someone ____________ in a business, he or she needs to research it.
- A.
Invests
- B.
Invested
- C.
Investing
Correct Answer
A. InvestsExplanation
If someone is interested in a business, they need to research it. The word "invests" is the correct answer because it matches the subject "someone" and agrees with the present tense of the sentence. It suggests that the person is currently considering or planning to invest in the business, which is why they need to conduct research.Rate this question:
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- 31.
____________ is a private institution that provides banking services to the public.
- A.
Central bank
- B.
Leading bank
- C.
Commercial bank
Correct Answer
C. Commercial bankExplanation
A commercial bank is a private institution that offers various banking services to the general public. Unlike central banks, which are government-controlled and primarily responsible for managing a country's monetary policy, commercial banks focus on providing financial services such as accepting deposits, granting loans, facilitating payments, and offering investment products. They operate for profit and play a crucial role in the economy by mobilizing savings and channeling funds to individuals, businesses, and other entities in need of capital. Therefore, a commercial bank is the correct answer as it aligns with the description provided.Rate this question:
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- 32.
There are a lot of electronic cash machine, which are named_________ in our country.
- A.
CD
- B.
ATM
- C.
Q-pay
Correct Answer
B. ATMExplanation
The correct answer is ATM. This is because the question asks for the name of electronic cash machines in our country, and ATM is a commonly used term for automated teller machines. CD and Q-pay are not commonly used terms for electronic cash machines.Rate this question:
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- 33.
___________ have terms of ten and more years.
- A.
Short-term loans
- B.
Long-term loans
- C.
Medium-term loans
Correct Answer
B. Long-term loansExplanation
Long-term loans have terms of ten and more years. This means that when individuals or businesses take out long-term loans, they agree to repay the borrowed amount over a period of at least ten years. These loans are typically used for large investments or purchases that require a longer time to pay off, such as buying a house or starting a business. Short-term loans, on the other hand, have much shorter repayment periods, usually less than a year, while medium-term loans typically have terms between one and ten years.Rate this question:
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- 34.
The local supermarket is a(n) __________ where all the employees share the profits.
- A.
Co-operative
- B.
Corporation
- C.
Owner
Correct Answer
A. Co-operativeExplanation
The correct answer is co-operative because a co-operative is an organization where all the members or employees work together and share the profits. In this context, the local supermarket is described as a co-operative where all the employees participate in sharing the profits generated by the business. This suggests that the supermarket operates on a cooperative model, promoting collaboration and equal distribution of profits among its employees.Rate this question:
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- 35.
Office rent, taxes and other administrative expenses are included in _________.
- A.
Variable costs
- B.
Advertising costs
- C.
Fixed costs
Correct Answer
C. Fixed costsExplanation
Office rent, taxes, and other administrative expenses are considered fixed costs because they do not vary with the level of production or sales. These costs are incurred regardless of the company's activity level and remain constant over a certain period. Variable costs, on the other hand, fluctuate with the level of production or sales. Advertising costs, although they can vary, are typically categorized as a separate expense and not included in fixed costs.Rate this question:
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- 36.
The manager wants a new desk, but the _________for office furniture is too small.
- A.
Debt
- B.
Budget
- C.
Plan
Correct Answer
B. BudgetExplanation
The manager wants a new desk, but the budget for office furniture is too small. This means that the amount of money allocated for purchasing office furniture is insufficient to cover the cost of a new desk. Therefore, the manager cannot fulfill their desire for a new desk due to the limited budget.Rate this question:
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- 37.
Every __________ of stock in the company receives dividends.
- A.
Public
- B.
Trading
- C.
Shareholder
Correct Answer
C. ShareholderExplanation
Shareholders are individuals who own shares or stocks in a company. As owners, they are entitled to receive dividends, which are a portion of the company's profits distributed to shareholders. Therefore, the correct answer is "shareholder" because they are the ones who receive dividends.Rate this question:
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- 38.
A company that doesn’t earn ___________ will not stay open.
- A.
Profits
- B.
Contributions
- C.
Permits
Correct Answer
A. ProfitsExplanation
In order for a company to stay open and continue operating, it needs to earn profits. Profits are the financial gains that a company makes after deducting all expenses and costs from its revenue. These profits are essential for the company to cover its operating expenses, invest in growth and development, and provide returns to its shareholders. Without profits, a company would not have the financial resources to sustain its operations and would eventually be forced to close down.Rate this question:
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- 39.
__________ can be turned into cash within a year.
- A.
Fixed assets
- B.
Current assets
- C.
Current liabilities
Correct Answer
B. Current assetsExplanation
Current assets can be turned into cash within a year. These assets include cash and other assets that are expected to be converted into cash or used up within the normal operating cycle of a business. Examples of current assets include cash, accounts receivable, inventory, and short-term investments. Current assets are important for a company's liquidity and ability to meet its short-term obligations.Rate this question:
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- 40.
People discuss investment with __________.
- A.
Bookkeepers
- B.
Financial advisors
Correct Answer
B. Financial advisorsExplanation
People discuss investment with financial advisors because financial advisors are professionals who have expertise and knowledge in various investment options. They can provide guidance and advice on how to invest money wisely based on an individual's financial goals, risk tolerance, and investment preferences. Financial advisors can help individuals create a personalized investment plan, diversify their portfolio, and make informed decisions to maximize their returns. They can also provide ongoing monitoring and adjustments to the investment strategy as needed.Rate this question:
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- 41.
Most bookkeepers work in the ______________.
- A.
Back office
- B.
File clerk
Correct Answer
A. Back officeExplanation
The correct answer is back office. Bookkeepers typically work in the back office of a company, which is the administrative area where financial transactions and records are processed. This includes tasks such as recording financial transactions, maintaining financial records, and preparing financial statements. The back office is separate from the front office, which is where customer-facing activities take place. Bookkeepers are responsible for ensuring accurate and up-to-date financial information, which is crucial for the smooth operation of a business.Rate this question:
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- 42.
The company makes __________ to the owners every month.
- A.
Cash distributions
- B.
Dividends
Correct Answer
A. Cash distributionsExplanation
The company makes cash distributions to the owners every month. This means that the company is giving out cash payments to its owners or shareholders on a regular monthly basis. Cash distributions are a way for the company to distribute its profits or excess cash to its owners as a form of return on their investment. Dividends, on the other hand, specifically refer to cash payments made to shareholders as a portion of the company's profits. Therefore, cash distributions and dividends are essentially the same thing in this context.Rate this question:
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- 43.
Subtract taxes from the __________ to find net income.
- A.
Operating margin
- B.
Gross margin
Correct Answer
A. Operating marginExplanation
To find net income, taxes need to be subtracted from the operating margin. The operating margin represents the percentage of revenue that is left after deducting the cost of goods sold and operating expenses. By subtracting taxes from the operating margin, the final amount of income after all expenses and taxes have been accounted for can be determined. Gross margin, on the other hand, represents the percentage of revenue that is left after deducting only the cost of goods sold, without taking into account operating expenses or taxes.Rate this question:
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- 44.
An amount added to costs when setting prices __________
- A.
Markup
- B.
Dumping
Correct Answer
A. MarkupExplanation
Markup refers to the amount added to the cost of a product or service in order to determine its selling price. It is commonly used to cover expenses and generate profit. By adding a markup, businesses can ensure that they are able to cover their costs and earn a profit margin. This pricing strategy is widely used in various industries to determine the selling price of goods and services.Rate this question:
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- 45.
"Bottom line" means ____________.
- A.
Sales revenue
- B.
Net income
Correct Answer
B. Net incomeExplanation
"Bottom line" is a commonly used term in business and finance to refer to the net income or profit of a company. It represents the final figure on a company's income statement after deducting all expenses and taxes from its revenue. Therefore, the correct answer for this question is net income.Rate this question:
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- 46.
__________often change each month.
- A.
Variable expenses
- B.
Fixed expenses
Correct Answer
A. Variable expensesExplanation
Variable expenses often change each month because they are costs that can fluctuate and are not set at a fixed amount. These expenses can include things like groceries, entertainment, transportation, and utility bills, which can vary depending on factors such as usage, market prices, and personal choices. Unlike fixed expenses, which remain constant, variable expenses can be adjusted and controlled to some extent based on individual needs and circumstances.Rate this question:
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- 47.
__________ is a document showing how much money was made.
- A.
Income statement
- B.
Balance sheet
Correct Answer
A. Income statementExplanation
An income statement is a financial document that provides information about the revenue, expenses, and net income of a company over a specific period of time. It shows how much money was made by detailing the company's sales, costs, and expenses, and calculates the resulting profit or loss. Unlike a balance sheet, which provides a snapshot of a company's financial position at a specific point in time, an income statement focuses on the company's financial performance and profitability. Therefore, an income statement is the correct answer as it specifically presents the information about the money made by the company.Rate this question:
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- 48.
Though the economy is bad, Sara is __________ about the future.
- A.
Optimistic
- B.
User friendly
Correct Answer
A. OptimisticExplanation
The given sentence states that the economy is bad, but despite this, Sara is optimistic about the future. This means that Sara has a positive outlook and believes that things will improve, despite the current negative circumstances.Rate this question:
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- 49.
To find __________ multiply hours by rate of pay.
- A.
Gross wages
- B.
Gross income
Correct Answer
A. Gross wagesExplanation
To find gross wages, you need to multiply the number of hours worked by the rate of pay. This calculation will give you the total amount of money earned before any deductions or taxes are taken out. Gross wages represent the total income earned by an individual before any deductions are made.Rate this question:
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- 50.
A fixed expense is one that is likely ___________.
- A.
To change each month
- B.
To stay the same each month
Correct Answer
B. To stay the same each monthExplanation
A fixed expense is one that remains constant or consistent each month. This means that the amount or cost of the expense does not change, regardless of any external factors or fluctuations. Fixed expenses are typically recurring payments that are predetermined and do not vary from month to month. Examples of fixed expenses include rent or mortgage payments, insurance premiums, and subscription fees. These expenses are expected to remain unchanged over time, providing stability and predictability in budgeting and financial planning.Rate this question:
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