*Financial awareness* Finance Quiz -Do You Know the Basics?

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

Author: Business So Simple

Hi, I am business consultant working with a team of Chartered Accountants, Company Secretaries, Lawyers & MBAs. I am promoter of " Make Your Business So Simple" "Make Education So Simple" Make Life So Simple" Make Legal Affairs So Simple".

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