Test: Finance & Management Basics

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Catherine Halcomb
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Test: Finance & Management Basics - Quiz

Do you know what is a balance sheet? What is marginal cost technique? Take or online quiz to see how much you already know and learn more along the way.


Questions and Answers
  • 1. 

    360 degree method relates to 

    • A.

      Performance appraisal 

    • B.

      Organisation climate

    • C.

      Employees morale 

    • D.

      Retrenchment method

    Correct Answer
    A. Performance appraisal 
    Explanation
    The 360-degree method is a type of performance appraisal that involves collecting feedback from multiple sources, such as supervisors, peers, subordinates, and even customers or clients. This method provides a comprehensive evaluation of an individual's performance by considering multiple perspectives. It helps in identifying strengths and weaknesses, areas for improvement, and promotes a more holistic and fair assessment of an employee's performance.

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  • 2. 

    Mention the world body that is advising for COVID - 19.

    • A.

      WHO

    • B.

      IMF

    • C.

      IFC

    • D.

      WTO

    Correct Answer
    A. WHO
    Explanation
    The correct answer is WHO. The World Health Organization (WHO) is advising on COVID-19. As the leading international health organization, WHO provides guidance, recommendations, and technical support to countries and individuals to prevent, detect, and respond to the pandemic. WHO plays a crucial role in coordinating global efforts, conducting research, and disseminating accurate information to protect public health and minimize the impact of the virus worldwide.

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  • 3. 

    The balance sheet is only

    • A.

      An account

    • B.

      A summary 

    • C.

      A statement 

    • D.

      None of the above

    Correct Answer
    B. A summary 
    Explanation
    The balance sheet is a financial statement that provides a summary of a company's financial position at a specific point in time. It presents the company's assets, liabilities, and shareholders' equity, giving a snapshot of its financial health. It helps stakeholders, such as investors and creditors, to assess the company's financial performance and make informed decisions. Therefore, the correct answer is "A summary."

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  • 4. 

    Who is officers of the Executive Board of WHO recently?

    • A.

      Dr. Harsh Vardhan

    • B.

      Dr. Suresh Vardhan

    • C.

      Dr. Sharma Vardhan

    • D.

      Dr. Vishnu Vardhan

    Correct Answer
    A. Dr. Harsh Vardhan
    Explanation
    Dr. Harsh Vardhan is the correct answer because he is currently serving as a member of the Executive Board of WHO. This can be inferred from the question which asks about the officers of the Executive Board of WHO "recently", indicating that the answer should reflect the current officers. The other options, Dr. Suresh Vardhan, Dr. Sharma Vardhan, and Dr. Vishnu Vardhan, are not mentioned or known to be officers of the Executive Board of WHO.

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  • 5. 

    Human relations approach of management is associated with

    • A.

      Abraham Maslow

    • B.

      Peter F Drucker 

    • C.

      Elton Mayo

    • D.

      Herzberg

    Correct Answer
    C. Elton Mayo
    Explanation
    Elton Mayo is associated with the human relations approach of management. He conducted the famous Hawthorne studies in the 1920s and 1930s, which focused on the effects of social and psychological factors on productivity. Mayo's research highlighted the importance of employee satisfaction, motivation, and group dynamics in the workplace. His findings challenged the traditional view of management and emphasized the significance of human factors in achieving organizational goals. Therefore, Elton Mayo is closely linked to the human relations approach of management.

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  • 6. 

    The term funds as used in funds flow statement means

    • A.

      Cash 

    • B.

      Current assets 

    • C.

      Current assets minus current liabilities 

    • D.

      Current liabilities 

    Correct Answer
    C. Current assets minus current liabilities 
    Explanation
    The term "funds" in a funds flow statement refers to the amount of money available to a company for its operations and investments. It represents the net amount of current assets (such as cash, accounts receivable, and inventory) that can be used to meet current obligations and expenses, after deducting current liabilities (such as accounts payable and short-term debt). By subtracting current liabilities from current assets, the funds flow statement shows the company's overall liquidity and ability to generate cash for its operations.

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  • 7. 

    Which of the following is a non-current liability?

    • A.

      Bills payable 

    • B.

      Sundry creditors 

    • C.

      Bank overdraft 

    • D.

      Long term loans

    Correct Answer
    D. Long term loans
    Explanation
    Long term loans are a type of borrowing that is not due for repayment within the next year, making them a non-current liability. Bills payable, sundry creditors, and bank overdraft are all current liabilities as they are expected to be settled within the next year.

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  • 8. 

    FEMA means

    • A.

      Free Export Management Act 

    • B.

      Foreign Exchange Management Act

    • C.

      Foreign Exchange Monitoring Act 

    • D.

      Free Export Marketing Act

    Correct Answer
    B. Foreign Exchange Management Act
    Explanation
    FEMA stands for Foreign Exchange Management Act. This legislation is responsible for the regulation and management of foreign exchange transactions in India. It aims to facilitate external trade and payments, promote orderly development and maintenance of foreign exchange market, and conserve foreign exchange reserves. The act empowers the Reserve Bank of India to regulate foreign exchange transactions and impose penalties for violations.

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  • 9. 

    Human resource management emphasise 

    • A.

      Development of people 

    • B.

      Punishment of people 

    • C.

      Adoption of people 

    • D.

      None of the above

    Correct Answer
    A. Development of people 
    Explanation
    Human resource management emphasizes the development of people. This means that HR managers focus on providing training, coaching, and opportunities for growth to employees in order to enhance their skills, knowledge, and abilities. By investing in employee development, organizations can improve performance, increase employee satisfaction and engagement, and ultimately achieve their goals more effectively. This approach recognizes the importance of nurturing and supporting employees to reach their full potential, rather than focusing solely on punishment or simply hiring new individuals.

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  • 10. 

    Which of the following is not a type of direct marketing?

    • A.

      Direct mail marketing 

    • B.

      Retail marketing 

    • C.

      Telemarketing 

    • D.

      Email direct marketing 

    Correct Answer
    B. Retail marketing 
    Explanation
    Retail marketing is not a type of direct marketing because it involves selling products or services directly to consumers through physical stores or online platforms, rather than targeting specific individuals through personalized communication channels. Direct mail marketing, telemarketing, and email direct marketing are all examples of direct marketing strategies that aim to reach potential customers directly and promote products or services through targeted communication methods.

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  • 11. 

    Marginal costing technique is useful for ?

    • A.

      Make or Buy decisions

    • B.

      Profit planning 

    • C.

      Shut down decisions 

    • D.

      All of the above

    Correct Answer
    D. All of the above
    Explanation
    Marginal costing technique is useful for all of the given options. When making Make or Buy decisions, marginal costing helps in determining whether it is more cost-effective to produce a product or purchase it from an external source. In profit planning, marginal costing helps in analyzing the impact of different levels of production on profitability. For shut down decisions, marginal costing helps in identifying the point at which the cost of producing further units exceeds the revenue generated, indicating that it may be more beneficial to shut down operations.

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  • 12. 

    Who has given fourteen principles of management

    • A.

      Barnard 

    • B.

      Henry Fayol

    • C.

      F.W Taylor

    • D.

      Flemming 

    Correct Answer
    B. Henry Fayol
    Explanation
    Henry Fayol is the correct answer because he is known for giving fourteen principles of management. Fayol was a French mining engineer and management theorist who developed these principles in the early 20th century. His principles are widely accepted and used in the field of management, providing a framework for effective organizational management.

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  • 13. 

    What is M.B.O?

    • A.

      Management by Objective

    • B.

      Multiple Business Organisation 

    • C.

      Management by Organisation 

    • D.

      Multiplicity of Business Operations 

    Correct Answer
    A. Management by Objective
    Explanation
    Management by Objective (MBO) is a management approach that focuses on setting specific goals and objectives for employees to achieve. It involves a collaborative process between managers and employees, where both parties agree on the objectives and the methods to achieve them. MBO emphasizes the importance of clear communication, employee involvement in goal-setting, and regular performance reviews to track progress. This approach helps align individual goals with organizational objectives, promotes accountability, and improves overall performance and productivity.

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  • 14. 

    Which one is related with micro financing?

    • A.

      Self Help Group (SHG)

    • B.

      Anganwadi workers

    • C.

      Women entrepreneurs 

    • D.

      None of the above

    Correct Answer
    A. Self Help Group (SHG)
    Explanation
    Microfinancing refers to the provision of small loans and financial services to individuals who do not have access to traditional banking services. Self Help Groups (SHGs) are a common form of microfinance where a small group of individuals pool their savings and provide loans to their members. SHGs empower individuals, particularly women, to become self-reliant and start their own businesses. Anganwadi workers are not directly related to microfinancing, and while women entrepreneurs may benefit from microfinance, they are not inherently linked to it. Therefore, the correct answer is Self Help Group (SHG).

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  • 15. 

    In marginal costing, contribution is equal to 

    • A.

      Sales - fixed cost

    • B.

      Sales - variable cost

    • C.

      Sales - profit

    • D.

      Sales - variable cost + fixed cost

    Correct Answer
    B. Sales - variable cost
    Explanation
    In marginal costing, contribution refers to the amount of money that is left over from sales revenue after deducting variable costs. This contribution is used to cover fixed costs and generate profit. Therefore, the correct answer is "Sales - variable cost." This equation allows businesses to determine the amount of revenue that is available to cover fixed costs and contribute towards profit.

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  • 16. 

    Who is father of scientific management?

    • A.

      Henry fayol

    • B.

      Elton mayo

    • C.

      Chester bernard 

    • D.

      F.W taylor

    Correct Answer
    D. F.W taylor
    Explanation
    F.W. Taylor is considered the father of scientific management because he is known for developing the principles of scientific management. He believed that productivity could be improved by applying scientific methods to analyze and optimize work processes. Taylor's ideas revolutionized the field of management by emphasizing the importance of systematic observation, measurement, and analysis to increase efficiency and productivity in organizations. His work laid the foundation for modern management practices and had a significant impact on the development of industrial engineering and organizational theory.

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  • 17. 

    Which of the following assets is usually assumed not to depreciate? 

    • A.

      Land

    • B.

      Building 

    • C.

      Plant 

    • D.

      Furniture 

    Correct Answer
    A. Land
    Explanation
    Land is usually assumed not to depreciate because it is considered a non-depreciable asset. Unlike buildings, plants, and furniture, land does not have a limited useful life and its value is expected to either remain stable or appreciate over time. This is because land is a finite resource and its supply cannot be increased. Additionally, land is considered to have an indefinite useful life as it can be used for various purposes and can be passed down through generations.

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  • 18. 

    Which item is shown on the debit side of a trial balance?

    • A.

      Purchase returns

    • B.

      Rent outstanding 

    • C.

      Prepaid expenses

    • D.

      None of the above

    Correct Answer
    C. Prepaid expenses
    Explanation
    Prepaid expenses are shown on the debit side of a trial balance because they represent expenses that have been paid in advance but have not yet been used or consumed. Since prepaid expenses are assets, they have a normal debit balance. Therefore, they are included on the debit side of the trial balance to ensure that the total debits equal the total credits. Purchase returns, rent outstanding, and none of the above are not typically shown on the debit side of a trial balance.

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  • 19. 

    A balance sheet shows only 

    • A.

      Personal accounts and nominal accounts 

    • B.

      Real account and nominal account

    • C.

      Personal accounts and real accounts

    • D.

      Personal, real and nominal accounts

    Correct Answer
    C. Personal accounts and real accounts
    Explanation
    A balance sheet shows the financial position of a company at a specific point in time. It includes personal accounts, which represent the financial transactions with individuals or entities, and real accounts, which represent the tangible assets and liabilities of the company. Nominal accounts, on the other hand, represent the revenue, expenses, and gains or losses of the company. Therefore, the correct answer is personal accounts and real accounts, as these are the categories of accounts that are included in a balance sheet.

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  • 20. 

    Which one do you like?

    • A.

      Option 1

    • B.

      Option 2

    • C.

      Option 3

    • D.

      Option 4

    Correct Answer
    A. Option 1
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