Financial Management - Study Mode

[#661] Accounts payable, accruals and notes payables are listed on balance sheet as
Correct Answer

(B) current liabilities

Explanation

Solution: Accounts payable, accruals and notes payables are listed on balance sheet as current liabilities. Current liabilities are a company's debts or obligations that are due within one year or within a normal operating cycle.

[#662] A loan that is repaid on monthly, quarterly and annual basis in equal payments is classified as
Correct Answer

(A) amortized loan

Explanation

Solution: A loan that is repaid on monthly, quarterly and annual basis in equal payments is classified as amortized loan. An amortized loan is a loan with scheduled periodic payments that are applied to both principal and interest.

[#663] An interest rate is 5%, number of period are 3, and present value is Rs 100,and then future value will be
Correct Answer

(A) 115.76

Explanation

Solution: FV = PV ( 1 + r/100 )ⁿ = 100 ( 1 + 5/100 )³ = Rs. 115.76

[#664] A method of inventory recording which produces high inventories in balance sheet is classified as
Correct Answer

(B) First in first out

Explanation

Solution: A method of inventory recording which produces high inventories in balance sheet is classified as First in first out. First in, first out (FIFO) is an asset-management and valuation method in which the assets produced or acquired first are sold, used or disposed of first and may be used by an individual or a corporation.

[#665] In uneven cash flow, 'IRR' is an abbreviation of an
Correct Answer

(A) internal rate of return

Explanation

Solution: In uneven cash flow, 'IRR' is an abbreviation of an internal rate of return. The internal rate of return (IRR) is a metric used in capital budgeting to estimate the profitability of potential investments.