1.

External sources of finance do not include:

debentures

overdrafts

leasing

retained earnings
Ans:d

2. Ordinary shares in limited companies:

have a limited life, and voting rights and receive dividends

have an unlimited life, and voting rights and receive dividends

have an unlimited life, and voting rights but receive no dividends

have a limited life, with no voting rights but receive dividends

3. Internal sources of finance do not include:

better management of working capital

trade credit

ordinary shares

retained earnings

4. Preference shares:

have no voting rights

are not part of a company’s share capital

receive dividends

are not allowable for corporation tax

a
 5. What is the most likely source of finance for a small firm

Debenture
Shares
Bank loan
Mortage

6.Which of the following options is a source of internal finance?

Selling assets
Trade credit
Bank loan
a

7. The arrangement of working capital and current assets can be done only by -------------------

a. Short term sources

b. Long term sources
c. Cost of capital
d. Financial plan
e. All of these
a

8. Which is/are the demerits of trade credit

f. The high price is charged in case of credit purchases

g. The customers have to accept even inferior quality of goods
h. This facility is not given to new customers and institutions
i. All of these
h

9. Which is the characteristics of share capital

j. Getting permanent capital

k. Payment of dividend is not compulsory
l. No mortgage of property
m. Limited liability
n. All of these
 n

10. If the company is new, then there are no ---------------

o. Retained earnings
p. Share capital
q. Employees
r. Directors
o

11. The payment of dividend is not compulsory on ------------------

s. Equity share capital and preference share capital

t. Bonds
u. Debentures
v. Share capital
s

12. The capital raised through equity share is ---------- for the company

w. Floating capital
x. Variable capital
y. Temporary capital
z. Permanent or fixed capital
aa. All of these
z

13. Preference shares are those shares whose holders have -------------

bb. Certain common rights

cc. Certain preferential Rights
dd. Return on capital ownership on shares
ee. Return on capital
cc

14. When preference shareholders have a right to convert their preference shares in to equity
shares after a pre-decided dare such shares are called -------- shares.

ff. Participating
gg. Convertible
hh. Redeemable
ii. Irredeemable
jj. None of these
gg
 15. The interest on debenture may be ---------------

kk. Fixed liability

ll. Flexible liability
mm. More cost
nn. Less cost
kk

16. Credit or Debit cards are popularly known as ‘_______ money.

(A) paper (B) plastic (C) polymer

17. The e‐business website / merchant website forwards the information to the

. (A) Payment Processor (B) Payment Gateway (C) Card Association

18. Wedding Planner is an example of _______ (A) corporate

organization (B) outsourcing (C) buying and selling of goods

19. www.flipkart.com is involved in _______ e‐business transactions.

(A) C to C (B) B to C (C) B to B

20. For online transaction, _______ is required.

(A) trading (B) registration (C) business

21. Between a Website and Payment Processor there is a

(A) Payment Gateway (B) Credit Card Association (C) Credit Card Issuing Bank

22. The redemption means

a. The payment of amount

b. The depreciation of the amount
c. The allocation of cost
 d. All of these
a

23. Minimum number of members to form a public company is

a. 5
b. 7
c. 12
d. 21

24. Application for approval of name of a company is to be made to

a. SEBI
b. Registrar of Companies
c. Government of India
d. Government of the State in which Company is to be registered

25. A proposed name of Company is considered undesirable if

a. It is identical with the name of an existing company

b. It resembles closely with the name of an existing company
c. It is an emblem of Government of India, United Nations etc.
d. In case of any of the above

26. A prospectus is issued by

a. A private company
b. A public company seeking investment from public
c. A public enterprise
d. A public company

27. Preliminary Contracts are signed

a. Before the incorporation

b. After incorporation but before capital subscription
c. After incorporation but before commencement of business
d. After commencement of business

28. Preliminary Contracts are

a. binding on the Company

b. binding on the Company, if ratified after incorporation
c. binding on the Company, after incorporation
d. not binding on the Company

29.
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Consider the following statements

The importance of the Memorandum of Association of a Joint-Stock Company is that

It is an unalterable Charter of the company

for the incorporation of every company, it is essential

its objective is to express clearly the risks to its shareholders and members

it ascertains the limit within which the company works and deals

Which of these statements are correct?

1, 2 and 3

2 and 4

1 and 3

1, 2, 3 and 4