Multiple choice questions – Financial Planning
1. Financial Planning deals with: (a) Preparation of Financial Statements, (b)Planning for a Capital Issue, (c) Preparing Budgets, (d)All of the above.
2. Financial planning starts with the preparation of:(a) Master Budget,(b) Cash Budget,
(c) Balance Sheet, (d)None of the above.
3. Which of the following is not a part of Master Budget?
(a)Projected Balance Sheet,(b)Capital Expenditure Budget,(c)Operating Budgets,
(d) Budget Manual.
4. Which of the following is not shown in Cash Budget?
(a)Proposed Issue of Capital, (b) Loan Repayment,(c) Interest on loan,(d) Depreciation.
5. During year 1, the sales and Cost of goods sold were Rs. 6,00,000 and Rs. 4,30,000 respectively. Next year, the sales are expected to increase by 10%. The Cost of goods sold for next year would be:
(a)Rs. 4,30,000,(b)Rs.4,90,000,(c)Rs.4,73,000,(d)Rs.4,40,000.
6. In ‘Percentage of Sales’ method of preparation of Projected Financial Statements, the Operating Expenses should be projected on the basis of:
(a) % of Profit before tax, (b) % of Cost of goods Sold, (c) % of Gross Profit, (d) % of Sales.
7. In’% of Sales’ method, various items of balance sheet are estimated on the basis of.
(a) % of Share Capital, (b) % of Sales in current year, (c) % of Fixed Assets,(d) % of Sales in preceding year.
8. In Projected Balance Sheet, a balancing figure:
(a) May appear on Assets Side,(b) May appear on Liabilities Side,(c) Would never appear,(d) Any of (a) or (&).
9.Procedure for preparation of ‘Projected Financial Statements’ should start from:
(a) Projection of Fixed Assets,(b) Projection of Capital,(c)
Projection of Sales,(d) Projection of Profit.
10. Which of the following is not considered which preparing cash budget?
(a) Accrual Principle,(b) Difference in Capital, and Revenue items, (c) Conservation Principle, (d) All of the above.
11.Which of the following may not be apart of projected Financial Statements?
(a) Projected Income Statement,(b) Projected Trial Balance,(c) Projected Cash Flow Statement,(d) Projected Balance Sheet.
12. Process of Financial Planning ends with:
(a) Preparation of Projected Statements,(b)Preparation of Actual Statements,(c) Comparison of Actual with Projected,(d) Ordering the employees that projected figures m come true.
13. Which of the following is not true for cash Budge?
(a)That shortage or excess of cash would appear in a particular period.(b) All inflows would arise before outflows for those periods. (c) Only revenue nature cash flows are shown.(d) Proposed issue of share capital in shown as an inflow.
[Answers: 1. (c); 2. (d); 3. (d); 4. (d); 5. (c); 6. (d); 7.
(d), 8 (d), 9. (c); 10. (d); 11. (b); 12. (c); 13. (c)]