Question 1

Management by objective is the process in which
A)Top management sets objectives for the sub- ordinate managers
B)Budgeteer proposes to accomplish specific jobs and prepares budget for it.
C)A manager decides his own area of operations and prepares budget for it.
D)Budget is not prepared at all.

Accepted Answer

B

Question 2

Return on Assets (ROA) ratio is given by which of the following?
A)Net Income/ Sales
B)Sales / Total Assets
C)Net Income/ Total Assets
D)Gross Margin/ Net Sales

Accepted Answer

ROA, or Return on Assets, measures how efficiently a company uses its assets to generate profit, calculated as Net Income divided by Total Assets.

Question 3

The Strategic Business Unit evolved during the ………………………
A)1970s & 1980s
B)1990s
C)1960s
D)21st Century

Accepted Answer

The concept of the Strategic Business Unit (SBU) primarily evolved during the 1970s and 1980s as organizations sought more effective ways to adapt to rapidly changing market environments and to manage diverse product lines more efficiently.

Question 4

The strategic Business Unit evolved from …………………
A)Hierarchy- based structure of organization
B)Function based structure of organization
C)Territorial structure of organization
D)Divisional structure of organization

Accepted Answer

The strategic Business Unit (SBU) concept primarily evolved from the divisional structure of organization, where organizations are divided into semi-autonomous units or divisions, each with its own strategy and bottom line.

Question 5

There are four elements of Anthony's model. Which one does not belong to the group?
A)Detector
B)Assessor
C)Effecter
D)Rejecter

Accepted Answer

Anthony's model of management control systems includes three elements: Detector, Assessor, and Effecter. The "Rejecter" is not part of Anthony's model, making it the correct choice for the element that does not belong.

Question 6

Total control over discretionary expense center is achieved primarily through ……… performance measures.
A)Financial
B)Non-financial
C)Objective based
D)Output based

Accepted Answer

Non-financial performance measures are often used to evaluate discretionary expense centers as they focus on qualitative aspects like customer satisfaction, employee engagement, and process improvements, which are crucial for controlling such centers.

Question 7

Which of the following areas is not covered under the Baldrige Award?
A)Education
B)Health Care
C)Small Business
D)Multi National Corporation (MNC)

Accepted Answer

The Baldrige Award covers areas such as Education, Health Care, and Small Business, but it does not specifically include Multi National Corporations (MNCs) as a distinct category for the award.

Question 8

Which of the following is an example of lead indication?
A)Market share
B)Net profit
C)Gross margin
D)ROI

Accepted Answer

Lead indicators predict future events or trends, and market share is an example of a lead indicator because changes in market share can indicate future financial performance and competitive position.

Question 9

Which of the following is not true? Asset employed is equal to
A)Non-current liabilities + shareholder's equity
B)Total assets - current liabilities
C)Non-current assets + working capital
D)Shareholder's equity -current liabilities

Accepted Answer

Asset employed is typically calculated as total assets minus current liabilities, or as non-current liabilities plus shareholder's equity. Shareholder's equity minus current liabilities does not represent asset employed.

Question 10

As asset becomes Non Performing after default of ……………………
A)180 days
B)60 days
C)90 days
D)91 days

Accepted Answer

An asset becomes Non Performing after a default of 90 days. This is a standard classification used by financial institutions to indicate when a loan or advance has not been paid back or serviced according to the terms of the agreement, signaling a significant risk of default.

Question 11

As per the RBI guidelines banks have to make sure that out of their loan assets-----------------loans are given to Priority Sector.
A)20%
B)40%
C)50%
D)45%

Accepted Answer

According to the Reserve Bank of India (RBI) guidelines, banks are required to ensure that at least 40% of their net bank credit is allocated to the priority sector. This is aimed at promoting inclusive growth by directing credit to sectors that are considered vital for the economy but may not get timely and adequate credit under normal bank lending conditions.

Question 12

The capital adequacy ratio to be maintained by public sector banks in India is ……………....
A)8%
B)10%
C)10.5%
D)12%

Accepted Answer

The answer of The capital adequacy ratio to be maintained...

Question 13

The Retailer is selling the merchandise for more than it costs the Retailer to acquire it, then the GMROI Ratio would be ……………………
A)Higher than 1
B)Equal to 1
C)Less than 1
D)Equal to 3.2

Accepted Answer

The Gross Margin Return on Investment (GMROI) ratio measures the profit a company makes for every dollar invested in inventory. If a retailer sells merchandise for more than it costs to acquire, the GMROI would be higher than 1, indicating a profit above the cost of the inventory.

Question 14

Which of the following do not fall under Financial inclusion ?
A)Nationalization of Banks
B)Public Sector Lending targets
C)Zero Balance Accounts
D)Education at affordable cost

Accepted Answer

Financial inclusion primarily focuses on providing access to financial services like banking, loans, and insurance to underserved and unbanked populations. Education at affordable cost, while important for overall socio-economic development, does not directly relate to financial services access, making it the correct choice.

Question 15

While calculating the Gross Margin Ratio on Investment (GMROI), the TWO important aspects are:
A)Stock on Hand and Stock-Outs incidents
B)Gross Margin and Average Inventory Cost
C)Gross Revenue and Stock on Hand
D)Carrying Costs and Stock-Out Costs

Accepted Answer

Gross Margin Ratio on Investment (GMROI) is calculated using Gross Margin and Average Inventory Cost, as these two factors directly impact the efficiency of inventory investment.

Question 16

PERT is the
A)Time oriented technique
B)Event oriented technique
C)Activity oriented technique
D)Target oriented technique

Accepted Answer

PERT (Program Evaluation and Review Technique) is an event-oriented technique because it focuses on the milestones or events within a project rather than the activities or tasks themselves.

Question 17

Which of the following is not one of the eight specific principles of Social Audit?
A)Comprehensive
B)Comparative
C)Multi-directional
D)Non-Participatory

Accepted Answer

Social Audit principles emphasize participation and inclusivity, making "Non-Participatory" inconsistent with its core values.

Question 18

Which of the following statement about NPOs is not true?
A)The NPOs generally tend to be service organisations
B)The NPOs receive 'Contributed Capital' and have no shareholders
C)The sources of funds for NPOs are more or less captive
D)The NPOs are subjected to Market Mechanism

Accepted Answer

NPOs (Non-Profit Organizations) are not primarily subjected to market mechanisms in the same way for-profit businesses are. Their operations and funding are often based on donations, grants, and other forms of support that do not directly correlate with market demand or competition.

Question 19

Which is not a primary objective of audit?
A)Detection and Prevention of Errors
B)Examining the System of internal check
C)Verifying the authenticity and validity of transactions
D)Confirming the existence and value of assets and liabilities

Accepted Answer

The primary objectives of an audit include examining the system of internal checks, verifying the authenticity and validity of transactions, and confirming the existence and value of assets and liabilities. Detection and prevention of errors, while important, are considered secondary objectives, as the main focus is on verifying the financial statements' accuracy and reliability.

Question 20

Which of the following area is not covered by management audit?
A)System and Procedures
B)Board's / Directors Analysis
C)Research and development
D)New product development cycle time

Accepted Answer

Management audit typically focuses on evaluating the efficiency and effectiveness of management processes and systems, rather than specific operational metrics like new product development cycle time.

Quiz 3: Management and Finance

Management by objective is the process in which

Return on Assets (ROA) ratio is given by which of the following?

The Strategic Business Unit evolved during the ………………………

The strategic Business Unit evolved from …………………

There are four elements of Anthony's model. Which one does not belong to the group?

Total control over discretionary expense center is achieved primarily through ……… performance measures.

Which of the following areas is not covered under the Baldrige Award?

Which of the following is an example of lead indication?

Which of the following is not true? Asset employed is equal to

As asset becomes Non Performing after default of ……………………

As per the RBI guidelines banks have to make sure that out of their loan assets-----------------loans are given to Priority Sector.

The capital adequacy ratio to be maintained by public sector banks in India is ……………....

The Retailer is selling the merchandise for more than it costs the Retailer to acquire it, then the GMROI Ratio would be ……………………

Which of the following do not fall under Financial inclusion ?

While calculating the Gross Margin Ratio on Investment (GMROI) , the TWO important aspects are:

PERT is the

Which of the following is not one of the eight specific principles of Social Audit?

Which of the following statement about NPOs is not true?

Which is not a primary objective of audit?

Which of the following area is not covered by management audit?