This 10-question quiz will give you a sense of the fundamentals you should learn to become a more effective manager/financial planner (This 10-question quiz isn’t designed to measure your entire financial IQ, You may *privately reply on my whatsup no 9560084833* or answer in your note book and match after 10 days Financial awareness Thumb rule series:
1. *The income statement measures:*
a. Profitability
b. Assets and liabilities
c. Cash
d. All of the above
2. *A sale on credit ends up on the income statement as revenue and as what on the balance sheet?*
a. Accounts receivable
b. Long-term assets
c. Short-term liability
d. Operating cash flow
3. *What happens when a company is profitable but collection lags behind payments to vendors?*
a. The company is OK because profits always become cash
b. The company stands a good chance of running out of money
c. The company needs to shift its focus to EBIT
d. The cash fl ow statement will show a negative bottom line
4. *How is gross profit margin calculated?*
a. COGS/revenue
b. Gross profi t/net profi t
c. Gross profi t/revenue
d. Sales/gross profit
5. *Which statement summarizes changes to parts of the balance sheet?*
a. Income statement
b. Cash fl ow statement
c. Neither of the above
d. Both of the above
6. *EBIT is an important measure in companies because:*
a. It is free cash fl ow
b. It subtracts interest and taxes from net income to get a truer picture of the business
c. It indicates the profi tability of a company’s operations
d. It is the key measure of earnings before indirect costs and transfers
7. *Operating expenses include all of the following except:*
a. Advertising costs
b. Administrative salaries
c. Expensed research and development costs
d. Delivery of raw materials
8. *Owners’ equity in a company increases when the company:*
a. Increases its assets with debt
b. Decreases its debt by paying off loans with company cash
c. Increases its profi t
d. All of the above
9. *A company has more cash today when:*
a. Customers pay their bills sooner
b. Accounts receivable increases
c. Profi t increases
d. Retained earnings increases
10. *Which of the following is not part of working capital?*
a. Accounts receivable
b. Inventory
c. Property, plant, and equipment
d. All of the above are part of working capital
Business So Simple 