14/10/2019 Tutor Test (Accounts) 14/10/2019 0Comments by Gate Academy Welcome to your Tutor Test (Accounts) You have 10 minutes to complete the test of 20 questions. Instructions 1. Answer ALL Questions. 2. Make sure you are prepared before you start the test. 3. Make sure you have a steady internet connection. 4. Do not attempt to reload the test page once you begin. 5. Fill the text field below with your correct details before you begin Full Name Email Address 1. The overall capitalisation rate and the cost of debt remain constant for all degrees of financial leverage is advocated by M-M Approach Traditional Approach Net Income Approach Net operating Income Approach 2. Which of the following has the highest cost of capital? Preference shares Bonds Loans Equity shares 3. Accounts Payable is classified as a/an ___________ in the _____________. Revenue; Income Statement Expense; Income Statement Current asset; Balance Sheet Current liability; Balance Sheet 4. Which one of the following is not used to estimate cost of equity capital? Capital asset pricing model External yield criterion Dividend plus growth rate Equity capitalisation approach 5. What is meant by accounts receivable? Money owed by a company to its vendors Money owed by a company to its creditors Money owed to a company by its debtors Money owed to a company by its employees 6. To which account in the Balance Sheet is the net income or net loss transferred to at the end of the accounting period? Cash Inventory Accounts Receivable Retained Earnings 7. Which of the following term is used to represent the proportionate relationship between debt and equity? Assets Structure Capital Budgeting Cost of capital Capital structure 8. Cost of capital from all the sources of funds is called Simple Average Cost Implicit Cost Composite cost Specific cost 9. Risk in capital budgeting implies that the decision maker knows __________ of the cash flows. None of these Probability Certainity Variability 10. Cost of capital is helpful in corporative analysis of various Source of Material Source of Finance Product Source of Services 11. Which method does not consider the time value of money? Internal Rate of Return Net present value Average rate of return Profitability Index 12. The concept of present value is based on the None of the above Both (a) and (b) Principle of compound Principle of discounting 13. The cost of capital method includes earning yield method all of the above dividend yield method growth in dividend method 14. Which of the following is an item of working capital? Accounts receivable Bonds payable Fixed assets Long-term investments 15. What is customer value? Ratio between the customer's perceived benefits and the resources used to obtained these benefits Excess of satisfaction over expectation Post purchase dissonance None of the above 16. Which of the following documents authorizes the purchase transaction? Purchase order Purchase requisition Credit memo from supplier Invoice or bill from supplier 17. The cost of debt capital is calculated on the basis of Annual Interest Arumal Depreciation Net proceeds Capital 18. The assets of a business can be classified as Fixed and current assets None of the above Only current assets Only fixed assets 19. Brown Glory Corp. has sales revenue of $150,000, sales discounts of $12,000, sales returns and allowances of $24,000, and cost of goods sold of $60,000. What would be the net sales revenue of Brown Glory Corp.? $54,000 $90,000 $102,000 $114,000 20. Two mutually exclusive projects with different economic lives can be compared on the basis of Internal Rate of Return Profitability Index Equivalent Annuity value Net Present Value You've successfully completed your test. Submit below.